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1. Which category of activity is almost a use of cash in the Cash Flow Statement?
2. The Accounts Payable is negative on the Cash Flow Statement. What does that represent from the standpoint of cash flow?
There is no impact to cash flow because the Accounts Payable are always balanced by the Accounts Receivable.
That is a use of cash since more money has been spent by the business to pay suppliers.
That is a source of cash since a reduction in this account is a reduction in the amount of money that is owed to suppliers.
3. What are examples of uses of cash within the Operating Activities section of the Cash Flow Statement?
Negative Net Income, positive Inventory changes, and positive Accounts Receivable changes.
Negative Net Income, positive Depreciation charges, and negative Inventory changes.
Increased capital investments, negative Accounts Receivables, and positive Depreciation charges.
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