Question : Cash Flow Statement is historical in nature because it is prepared on the basis of Profit and Loss Account and Balance Sheet, which is based on past transactions.
Option 1: Correct
Option 2: Incorrect
Option 3: Both A and B
Option 4: None of the above
Answer (1)
18th Jan, 2024
Correct Answer: Correct
Solution : Answer = Correct
Correct. The Cash Flow Statement is historical because it reflects past transactions recorded in the Profit and Loss Account and Balance Sheet. It provides a summary of cash inflows and outflows over a specific period, offering insights into the company's financial performance and liquidity position.
Hence, the correct option is 1.
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