What is the primary purpose of the cash flow statement?

The primary purpose of the cash flow statement is to track cash inflows and outflows within a business over a specific period. This financial statement provides important insights into a company's liquidity and cash management by detailing how cash moves in and out of the organization from operating, investing, and financing activities.

Understanding cash flows is crucial for assessing a company's ability to meet its short-term obligations, fund its operations, and invest in future growth. A cash flow statement helps stakeholders gauge the financial health and long-term viability of the business by revealing sources of cash and how it is used, different from just showing profitability or revenue generation.

While the other options mention important financial elements, they do not specifically address the main objective of the cash flow statement. Revenue reporting and profitability assessment are typically covered in the income statement, and evaluating long-term debts falls under the balance sheet analysis rather than cash flow management. Thus, tracking cash inflows and outflows is what distinctly captures the essence of the cash flow statement's purpose.