1. What is the purpose of a statement of cash flows? Please explain in your own words how the statement of cash flow can be helpful to a business.
2. What are the (3) major sections on a statement of cash flows, and what type of cash inflows and outflows should be included in each of these three sections?
3. Assume that a company repays a $300,000 loan from its bank, and then later in the same year they borrow another $500,000. In what section does this transaction belong, and what dollar amount(s) appear on the statement of cash flows?