A statement of cash flows explains the differences between the beginning and ending balances of:

A) Net income.
B) Equity.
C) Cash and cash equivalents.
D) Working capital.
E) Cash and short-term investments.

Cash and Cash Equivalents

Liquid assets that include currency, checks, and short-term investments that can be quickly converted to cash.

Net Income

Net income is the total profit remaining after all expenses, taxes, and costs have been subtracted from total revenues.

Equity

The value of an owner's interest in a property or business, calculated as the difference between the assets and liabilities.