Question

In an insurance company, what does cash flow from operating activities indicate?

a.

Profitability of investment portfolio

b.

Extent to which operations generate sufficient cash flows

c.

Long-term growth potential

d.

Effectiveness of marketing strategies

Posted under IC 89 Management Accounting

Answer: (b).Extent to which operations generate sufficient cash flows Explanation:In an insurance company, cash flow from operating activities is a key indicator of the extent to which the operations have generated sufficient cash flows to maintain the operating capability of the insurers.

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Q. In an insurance company, what does cash flow from operating activities indicate?
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