If Sales are 100,000 and Cash Collected from customers is 100,000, what does this imply about Accounts Receivable?
Explanation
Cash matches revenue exactly only when the receivables balance remains constant.
Other questions
How should non-cash investing and financing activities be reported according to the text?
Under US GAAP, how are dividends paid classified?
Under IFRS, how can dividends paid be classified?
Under US GAAP, how is interest received classified?
Under IFRS, how can interest received be classified?
How are bank overdrafts treated under IFRS?
Which method of presenting CFO starts with Net Income?
In the indirect method, how is depreciation treated?
Which Balance Sheet items is Cash Flow from Investing (CFI) related to?
How is 'Cash collected from customers' calculated under the direct method?
A company has Opening AR of 10,000, Closing AR of 15,000, and Credit Sales of 55,000. What is the Cash Received?
A company has Opening AP of 30,000, Closing AP of 25,000, and Credit Purchases of 60,000. What is the Cash Paid?
In the indirect method, what happens to 'Income tax payable' if it increases during the year?
Under US GAAP, where are taxes classified in the cash flow statement?
Under IFRS, where can taxes be classified?
What is the relationship between CFO and the Balance Sheet?
If Opening Interest Payable is 50,000, Interest Expense is 15,000, and Closing Interest Payable is 55,000, what is the Cash Paid for interest?
If Opening Tax Payable is 25,000, Tax Expense is 5,000, and Closing Tax Payable is 15,000, what is the Cash Paid for taxes?
Which method requires calculating cash collected from customers and cash paid to suppliers?
How is 'Net Income' adjusted for 'Interest income' in the indirect method example provided?
Which part of the Balance Sheet does CFF relate to?
How do Working Capital Changes affect CFO in the Indirect method formula?
Under US GAAP, dividends received are classified as:
Under IFRS, interest paid can be classified as:
Under US GAAP, interest paid is classified as:
In the direct method, how is 'Cash paid for operating expenses' calculated?
If a company uses the Indirect Method, how are Non-cash charges (NCC) treated?
When converting from Indirect to Direct method, what is the goal?
Which of the following items is subtracted from Net Income in the Indirect Method?
If Inventory increases by 5,000 and Accounts Payable increases by 2,000, what is the net effect on cash flow from operations compared to COGS?
According to the text, what must be done with non-cash investing and financing activities?
Under US GAAP, which of the following is an Investing Cash Flow (CFI)?
In the indirect method example, Net Income is 15,000. Working capital changes are (5,000). What is the impact of working capital on CFO?
Which framework classifies Dividends Received as either CFO or CFI?
In the computation of CFs example, Credit Sales are 55,000. Opening AR is 10,000. Closing AR is 15,000. What is the change in AR?
How is 'Cash paid for operating expenses' presented in the Direct Method example?
What is the formula for CFO using the Indirect Method regarding CFI and CFF transactions?
What is the primary difference in reporting 'Taxes' between IFRS and US GAAP?
If a company has an increase in Unearned Revenue, how does this affect CFO in the indirect method?
In the indirect method, a decrease in Accounts Receivable is:
Which statement correctly describes the conversion from Indirect to Direct method?
What type of account is 'Interest Payable' in the context of cash flow adjustments?
If a company reports a Gain on Sale of Machinery of 10,000 in its Income Statement, what adjustment is made in the Indirect Method?
If Opening AR is 10,000 and Cash Received is 50,000 and Sales are 55,000, what must be the Ending AR?
Under IFRS, where is Interest Paid classified if the company chooses to treat it as a cost of obtaining finance?
In the computation of Cash Paid to Suppliers, if Inventory is constant, the formula simplifies to:
What does the abbreviation NCC stand for in the context of the Indirect Method formula provided?
Under US GAAP, Bank Overdrafts are typically reported as:
Which method of presenting CFO is encouraged by standard setters but less commonly used in practice?