101. A cash payment to purchase treasury stock is reported on the statement of cash flows as a financing activity.
102. Companies report significant noncash investing and financing activities on a schedule that accompanies the statement of cash flows.
103. The three main sections of the statement of cash flows are, in order, operating activities, investing activities, and financing activities.
104. The final or bottom line on the statement of cash flows is the net increase or decrease in cash for the period.
105. The amount of revenue a company recognizes on the income statement normally differs from the amount of cash collected from customers.
106. Goodloe Corporation's credit sales for 2016 were $500,000, and the balance in its accounts receivable increased by $26,000 during the year. In 2016, Goodloe collected $526,000 in cash from its customers.
107. Middleton Corporation reported utilities expense of $18,200 on its income statement for 2016. For the year, the beginning balance in Utilities Payable was $2,500 and the ending balance was $1,500. The amount of cash that Mayes paid for utilities in 2016 was $19,200.
108. Jones Company requires prepayment from all customers. Jones Company reported revenue of $258,000 on its 2016 income statement. The balance in its Unearned Revenue account was $12,000 at the start of 2016 and $4,000 at the end of the year. Based on this information alone, the amount of cash that Jones collected from customers for 2016 was $250,000.
109. The direct method of preparing the operating activities section of the statement of cash flows is preferred by the Financial Accounting Standards Board.
110. The indirect method for preparing the operating activities section of the statement of cash flows begins with the amount of sales revenue reported on the income statement.