[amp_mcq option1=”Both (A) and (R) are correct, and (R) is the correct explanation of (A)” option2=”(A) is correct, but (R) is incorrect” option3=”(A) is incorrect, but (R) is correct” option4=”Both (A) and (R) are incorrect” correct=”option1″]<\/p>\n
The correct answer is: (A) Both (A) and (R) are correct, and (R) is the correct explanation of (A).<\/p>\n
Cash flow statement is a financial statement that shows how much cash a company has received and spent over a period of time. It is used to track a company’s liquidity and solvency. The cash flow statement is not a complete picture of a company’s financial position, but it is an important tool for understanding a company’s cash flow.<\/p>\n
Working capital is a measure of a company’s ability to meet its short-term obligations. It is calculated by subtracting current liabilities from current assets. Working capital is important because it indicates whether a company has enough cash on hand to meet its short-term obligations.<\/p>\n
The assertion (A) is correct because the cash flow statement does not provide a complete picture of a company’s financial position. The reason (R) is also correct because cash is an important constituent of the working capital. Therefore, both (A) and (R) are correct, and (R) is the correct explanation of (A).<\/p>\n
Here is a brief explanation of each option:<\/p>\n
[amp_mcq option1=”Both (A) and (R) are correct, and (R) is the correct explanation of (A)” option2=”(A) is correct, but (R) is incorrect” option3=”(A) is incorrect, but (R) is correct” option4=”Both (A) and (R) are incorrect” correct=”option1″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[952],"tags":[],"class_list":["post-48319","post","type-post","status-publish","format-standard","hentry","category-costing","no-featured-image-padding"],"yoast_head":"\n