What items are utilized in computing the ending cash balance for the year?

The calculation of the ending cash balance for the year involves starting with the cash balance at the beginning of the year and then adjusting this amount based on various cash inflows and outflows that occurred during the year. This process is encapsulated in the cash flow statement, which breaks down cash flows into three main categories: operating, investing, and financing activities.

Starting with the cash balance at the beginning of the year provides the initial amount of cash on hand. Cash flow from operating activities accounts for the cash generated or used in the core business operations and affects the cash balance significantly. Similarly, cash flow from investing activities reflects the cash used for investments or cash received from the sale of assets, which also impacts the overall cash position. Finally, cash flow from financing activities includes funds obtained or paid to finance the company, such as issuing stocks or paying off loans.

By summing these components, you arrive at the ending cash balance for the year. This method accurately reflects how transactions impact cash, ensuring the reported figure represents the actual cash available at year-end, making option D the correct choice.