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Boreal Corporation is a private corporation reporting under ASPE and uses the indirect method when preparing its statement of cash flows.The company has engaged in the following transactions.For each transaction, indicate where it would be reflected on the statement of cash flows.
-A decrease in accounts receivable from year one to year two:
A)operating activities section
B)investing activities section
C)financing activities section
D)does not represent a cash flow

Question

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Boreal Corporation is a private corporation reporting under ASPE and uses the indirect method when preparing its statement of cash flows.The company has engaged in the following transactions.For each transaction, indicate where it would be reflected on the statement of cash flows.
-A decrease in accounts receivable from year one to year two:
A)operating activities section
B)investing activities section
C)financing activities section
D)does not represent a cash flow

Quizplus · Accepted Answer

A decrease in accounts receivable indicates that more cash has been collected from customers, which is an operating activity.

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