Question

The net cash flows from operating, investing, and financing activities will equal:

Multiple Choice
O
O
Net income minus dividends for the year.
The ending balance of cash this year.
The change in cash reported in the balance sheet from this year versus last year.
The change in stockholders' equity for the year.

Answer 1

The net cash flows from operating, investing, and financing activities equate to the change in cash reported on the balance sheet, which reflects the company's cash position at the end of the period.

Step-by-step explanation:

The net cash flows from operating, investing, and financing activities will equal the change in cash reported on the balance sheet from this year versus last year. This is because the Statement of Cash Flows is designed to explain the change in a company's cash and cash equivalents over a period. It starts with the beginning cash balance, adds or subtracts the cash flows from operating, investing, and financing activities, and arrives at the ending cash balance. This ending balance should match the cash reported on the balance sheet at the end of the period.

The information provided regarding international trade and capital flows, including the inflow of foreign financial capital and related components of the current account balance, is important for understanding the broader context of financial transactions. However, for the purposes of this specific question on corporate financial statements, the focus is on a company's individual activities and how they affect cash position, not on macroeconomic trade balances.