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In the statement of cash flows, a transaction in which the Cash account is credited represents what?
AA cash outflow
BA cash inflow
CA non-cash adjustment
DAn accrued revenue
Answer & Solution
Correct answer: A. A cash outflow
1. When Cash is debited, cash is received: a cash inflow.
2. When Cash is credited, the business makes a payment: a cash outflow.
3. The question credits Cash, so it is an outflow.
_Source: Jonick, Principles of Financial Accounting (CC BY-SA 4.0), §7.2.2 "Cash Inflows and Outflows", p.266_
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