Which one of the following statements regarding financial reports is correct?

Multiple Choice

The statement of stockholders' equity updates the balances of common stock and retained earnings for related transactions during the year.

The statement of cash flows reports cash inflows and outflows from operating activities only.

The income statement is used to show that a company's total resources equal the sum of claims to those resources.

The balance sheet classifies all assets according to operating, investing, and financing activities.