A cash collection from a customer pertaining to a sale from the prior year will result in cash flow being reported in this year's statement of cash flows.

Question

Quizplus · Accepted Answer

Cash flow is reported when cash is received or spent, regardless of the timing of the sale or expense. Therefore, a cash collection from a prior year sale would be reported in the current year's statement of cash flows.

A Cash Collection from a Customer Pertaining to a Sale