Cash flow question

Can someone please help me with this question, I would really appreciate it.

When building a financial statement model, the total cash balance calculated on the cash flow statement (cash from operating + financing + investing activities):

1. Must equal cash flow balances inputted on the balance sheet
2. Will always exceed cash flow balances inputted on the balance sheet by cash from operating activities
3. Will always trail cash flow balances inputted on the balance sheet by cash from operating activities
4. None of the above

Thanks!

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Comments (4)

Jan 3, 2013 - 10:16pm

1. From my understanding the ending cash on the Statement of Cash flows for that period is starting point for cash and cash equivalents on the balance sheet for that period. The balance sheet from the previous period and current period are snapshots where the statement of cash flows is the explanation of what happened in between those two snap shots. Can anyone verify if this sounds correct?

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