Which financial statement provides cash receipts and cash payments for a period?

• A. Statement of Cash Flows
• B. Balance Sheet
• C. Stock
• D. Net income

Answer: (A)

This question tests your understanding of which financial statement shows how cash comes in and goes out over time. The Statement of Cash Flows tracks cash receipts and cash payments across three activities—operating, investing, and financing—during a specific period (such as a month, quarter, or year). It’s the go-to tool for seeing actual cash movement, which helps assess liquidity and how cash is generated and used.

The Balance Sheet, by contrast, shows what the company owns and owes at a single point in time, including cash as an asset, but it doesn’t detail the cash flows that occurred during the period. Net income, reported on the income statement, reflects profitability for the period, not cash movements. Stock refers to ownership in the company and isn’t a financial statement at all.