Question

Select the correct answer. Why do investors analyze cash flow statements before investing in a business? A. to evaluate the legality of the cash transactions B. to evaluate revenue flow and profitability of the business C. to figure out whether a business is capable of repaying bank loans and acquiring assets in the future D. to figure out the profit before tax E. to create a report assessing the organization’s financial health

Answer 1

Why do investors analyze cash flow statements before investing in a business?

to evaluate revenue flow and profitability of the business

Step-by-step explanation:

Every investors main aim is to maximize profit, before an investors invests in a business. It is expedient to evaluate how revenue flows how such business is profitable.