How can you tell by looking at a company's Statement of Cash Flows if the company is borrowing more money or paying back more debt?

FINANCIAL ACCOUNTING
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ISBN:9781259964947
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Chapter1: Financial Statements And Business Decisions
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How can you tell by looking at a company's Statement of Cash Flows if the company is borrowing more money or paying back more debt?

Expert Solution
Step 1 Cashflow statements

In a cash flow statement, there are 3 types of activities:

a. Operating b. Investing c. Financing activties

According to IAS 7 - Statement of cashflow:

Financing activities are activities that alter the equity capital and borrowing structure of the entity [IAS 7.6]

Hence, financing activities is the one area you should look for to determine the question asked

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