write the uses of cash flow statement
Answers
Answer:
The purpose of the cash flow statement is to show where an entities cash is being generated (cash inflows), and where its cash is being spent (cash outflows), over a specific period of time (usually quarterly and annually). It is important for analyzing the liquidity and long term solvency of a company.
Answer:
Every business runs with cash and most of the transactions of every business basis on the cash. But financial statements like balance sheet and profit and loss mainly focuses on financial resources and financial performance leaving cash transactions aside. To fill this gap the concept of cash flow statement created. Cash flow statement or Statement of Cash flow mainly focuses on the cash transactions and cash equivalents. Even though these statements do not reflect the financial assets of a firm but play a crucial role in the functioning of a business.