1.Which of the following statements about the statement of cashflows is not correct?

It does not replace the income statement.

It provides details as to how cash changed during a period.

It provides information about cash receipts and cash paymentsover a period of time.

It measures profitability.

2.Cash flows from operating activities include all of thefollowing except:

a purchase of land.

collections from customers on account.

payments to employees for hours worked.

receipt of cash dividends.

3.Which of the following statements about the statement of cashflows is not correct?

The statement of cash flows can be used to assess the likelihoodof a company paying dividends.

Net cash flow is the best measure of profitability since it doesnot rely on estimates.

A company can have positive net income but at the same time havenegative cash flow.

The statement of cash flows is the only financial statement thatreports business activities.