Question

is one cash flow statement enough for everyone, why or why not?

is one cash flow statement enough for everyone, why or why not?

Homework Answers

Answer #1

One cashflow statement is not enough for everyone. This is because of following reasons
1. Multiple cash flow statments of previous years is required to obtain the valuation of company through Price to cash flow multiple.
2. Cash flows statements of previous years are required to identify increase or decrease in operating, investng or financing cash flows.
3. Cash flow statements of other companies are required to compare the cash flows of the other companies and find out the financial weakness in a company.

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