1. Mary Company collected cash from an account receivable. The recognition of th

Question

1. Mary Company collected cash from an account receivable. The recognition of the cash collection will affect which of the following financial statements?

a) Balance sheet and the statement of cash flows

b) Statement of changes in stockholders’ equity

c) Income statement and the statement of cash flows

d) Income statement and the balance sheet

2. Paying cash to settle a salaries payable obligation will affect which section of the statement of cash flows?

a) Financing activities

b) Investing activities

c) Noncash activities

d) Operating activities

Explanation / Answer

Dear student, only one question is allowed at a time. I am answering the first question

Both cash and accounts receivables are current assets and any changes in current assets affects Balance Sheet and Statement of cash flows but does not affect Statement of changes in stockholders’ equity and Income statement as this transaction has no impact on Income of an organization and so statement of changes in stockholder’s equity and Income statement are not affected

So, as per above discussion, option a is the correct option

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.