11. The conversion of preferred stock to common stock is disclosed in the financing section of the statement of cash flows.
12. A purchase of land in exchange for a long-term note payable is reported in the investing section of the statement of cash flows.
13. A noncash investing transaction should be disclosed as either a footnote or small schedule attached to the statement of cash flows.
14. A company purchased equipment for $150,000 by paying $50,000 and signing a $100,000 note payable. The entire transaction is disclosed to users on the statement of cash flows and/or in its notes.
15. A purchase of land in exchange for shares of stock is disclosed on the statement of cash flows or in a note to the statement.
16. Accounting standards require that the statement of cash flows be included in a complete set of financial statements.
17. The statement of cash flows explains how transactions and events impact the end-of-period cash balance to produce the end-of-period net income balance.
18. Most managers stress the importance of understanding and predicting cash flows for business decisions.
19. Managers only use the cash flow statement to evaluate the overall net cash increase or decrease and do not pay much attention to the details of cash flows from operating activities, cash flows from investing activities, and cash flows from financing activities.
20. The FASB requires the reporting of cash flows per share as a measure of earnings performance.