Which category includes both operating activities and financing activities in cash flow statements?

The correct answer captures the essence of the cash flow statement categories. Operating activities refer to the primary revenue-generating activities of the governmental entity and include cash received from services, taxes, and payments to suppliers and employees. Financing activities encompass transactions that affect long-term liabilities and equity, such as issuing bonds or obtaining loans.

When considering cash flow statements, the key aspect of operating activities is that they depict how cash is generated from core business operations, while financing activities show how cash is obtained or used in relation to funding sources. The question specifically inquires about a category that merges both these facets, ultimately identifying that operating activities comprise a range of cash flows crucial for assessing the entity's overall financial health.

Although other categories mentioned focus on specific areas—including non-capital financing activities, investing activities, and capital and related financing activities—none of these encompass both operating and financing activities comprehensively. Operating activities primarily illustrate operational cash flows, illustrating their fundamental role in overall cash flow analysis.