List the purposes and uses of the statement of cash flows and discuss the three activities that the statement of cash flows depicts.
The primary purpose of the statement of cash flows is to offer information about cash receipts and payments. It also presents the net change in cash from operating, investing, and financing activities during a given period. Operating activities cash flows arise from the operations a business does to produce net income. Cash flows from investing activities refer to business transactions relating to investments in long-term assets. Finally, financing activities are cash transactions related to organizations raising money from debt or stocks.