contestada

One of the benefits of the statement of cash flows is that it helps users evaluate financial flexibility. Which of the following explanations is a description of financial flexibility? The firm's ability to invest in a number of projects with different objectives and costs. The nearness to cash of assets and liabilities. The firm's ability to respond and adapt to financial adversity and unexpected needs and opportunities. The firm's ability to pay its debts as they mature.

Respuesta :

Answer:

The firm's ability to respond and adapt to financial adversity and unexpected needs and opportunities.

Explanation:

Financial adversity refers to difficulty is obtaining fund to take opportunities and meet needs including debt settlement.

The statement of cash flows shows how much cash flows and out of an organisation and how regular and stable they are. It therefore allows user to evaluate financial flexibility of the organisation.