Accounting · Financial Statement Analysis
Based on the comparative usefulness of financial analysis statements, which of the following statements correctly distinguishes between the primary utilities of a Cash Flow Statement and a Funds Flow Statement?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
Share:
- 1Cash Flow Statements evaluate the long-term movement of working capital, whereas Funds Flow Statements are strictly designed for assessing immediate, short-term cash liquidity.
- 2Both Cash Flow Statements and Funds Flow Statements are exclusively utilized for intermediate and long-term financial structuring, with neither being suitable for short-term analysis.
- 3Funds Flow Statements are deemed superior for short-term liquidity analysis and immediate cash planning, whereas Cash Flow Statements are better suited for intermediate and long-term financial structuring.
- 4Cash Flow Statements are deemed superior for short-term liquidity analysis and immediate cash planning, whereas Funds Flow Statements are better suited for intermediate and long-term financial structuring.✓
Correct answer
Cash Flow Statements are deemed superior for short-term liquidity analysis and immediate cash planning, whereas Funds Flow Statements are better suited for intermediate and long-term financial structuring.
Download Single Question PDF
Save this question and verified answer as a clean study sheet with live clickable link.
👥
Share with Friends & Study Groups
Challenge your peer aspirants on WhatsApp or Telegram to solve this question!
Online Test Series
Start Free Mock Test →Preparing for Accounting?
Practice full-length mock tests with real exam timers, instant score analysis, and all-India ranking.
Chapter Practice
Practice Financial Statement Analysis MCQs →Want more practice questions on Financial Statement Analysis?
Solve complete topic-wise tests with detailed solutions on GkGet.
Related Practice Questions
Recommended practice questions in Accounting · Financial Statement Analysis