Asked by Nickie Thatcher on May 28, 2024

verifed

Verified

A source of cash is defined as:

A) Any transaction which increases the value of an asset account.
B) Any statement of financial position account which increases in value.
C) The change in a firm's liquid accounts over a stated period of time.
D) Any activity which brings in cash to the firm.
E) Any activity which decreases the liabilities of a firm.

Source Of Cash

Refers to the origins of funds for a business or individual, such as operations, financing activities, or investment returns.

Asset Account

This refers to any account on a company's balance sheet that represents a tangible or intangible resource owned by the company that has economic value.

Liquid Accounts

Refers to financial accounts which hold assets that can be readily converted into cash, often with little to no loss in value, such as savings accounts or money market accounts.

  • Understand the importance of the cash flow statement.
verifed

Verified Answer

SM
swathi MenonJun 01, 2024
Final Answer :
D
Explanation :
A source of cash refers to any activity that brings in cash to the firm, such as sales revenue, receiving a loan, or selling an asset. The other options do not specifically describe activities that increase the firm's cash.