Question 10 of 29beginner💡 UnderstandTrue / False1 mark

The financial statements of a business enterprise include cash flow statement.

Correct Answer

True

Exercise: Test your Understanding – III | Q: a | (Page 17)
For More Understanding

Explanation

According to the textbook context, under the Summary section titled 'Major Parts of an Annual Report', it clearly states: 'An annual report contains basic financial statements, viz., Balance Sheet, Statement of Profit and Loss and Cash Flow Statement.' Additionally, in Test your Understanding – II, question 1 asks about the financial statements of a business enterprise, and the correct answer would be 'All the above' which includes Cash Flow Statement as one of the options. Therefore, the statement is True.

Solution Steps

  1. Step 1: Identify the statement about financial statements including cash flow statement.

  2. Step 2: Refer to the context which explicitly lists Cash Flow Statement as one of the basic financial statements in an annual report.

  3. Step 3: Conclude that the statement is True based on the textbook evidence.

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