Question

Cash Flow Statement Shows cash from operating, investing, and financing activities Accounting Equation Assets = Liabilities + Equity Net Income Assets = Liabilities + Equity Balance Sheet Shows cash from operating, investing, and financing activities Income Statement "Snapshot" of a company’s activities at a given point in time Liquidity How quickly assets can be converted into cash?

Answer 1

Answer:

Cash Flow Statement Shows cash from operating, investing, and financing activities TRUE

Accounting Equation: Assets = Liabilities + Equity Net Income OR  Assets = Liabilities + Equity.  TRUE

Balance Sheet Shows cash from operating, investing, and financing activities FALSE

Income Statement "Snapshot" of a company’s activities at a given point in time FALSE

Liquidity How quickly assets can be converted into cash? TRUE

Explanation:

1. Cash Flow Statement Shows cash from operating, investing, and financing activities TRUE

By Definition, A cash flow statement is a financial statement that shows all the cash inflows into, and cash outflows outside the company in an analytical format. The sources includes all cash flows that a company receives from its ongoing operations and external investment sources; and also from fund providers like shareholders and bank loans.

2. Accounting Equation: Assets = Liabilities + Equity Net Income

OR Assets = Liabilities + Equity. TRUE

Accounting Equation Format for the balance sheet is that TOTAL ASSETS (which includes both Fixed and Current assets) should be of the same value with Equity and Total Liabilities

3. Balance Sheet Shows cash from operating, investing, and financing activities FALSE

A Balance Sheet is a statement of the assets, liabilities, and capital (which could also be equity) of a business or organization at a particular point in time.  It is rather a cash flow statement that shows cash from operating, investing, and financing activities.

4. Income Statement "Snapshot" of a company’s activities at a given point in time FALSE

An income statement is the profit and loss account which shows the company’s revenues and expenses during a particular period. It is rather a balance sheet that is a snapshot of a company's activities

5. Liquidity How quickly assets can be converted into cash? TRUE

Liquidity is the measure of the extent to which an organization has the cash to meet immediate or short-term obligations as they fall due. It also refers to the possession of assets that can be immediately converted to cash, commonly referred to as 'cash equivalents'