A company uses the indirect method to prepare the statement of cash flows. It presents the
following amounts on its December 31, 2007 financial statements.
December 31, 2007
December 31, 2006
Cost of goods sold
*Relates solely to the acquisition of inventory
What will appear in the operating activities section related to accounts receivable?
A) The increase of $10,000 will be subtracted from sales revenue.
B) The increase of $10,000 will be added to net income.
C) The increase of $10,000 will be added to sales revenue.
D) The increase of $10,000 will be subtracted from net income
Which of the following is the correct order of the sections on a statement of cash flows?
A) The correct order is operating, financing, investing.
B) The correct order is financing, investing, operating.
C) The correct order is investing, operating, financing.
D) The correct order is operating, investing, financing.