Practice Quiz

Case Interview Prep

Category - Accounting

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Which financial statement does not include sales that are recorded as credit?
  1. The balance sheet
  2. The income statement
  3. The statement of cash flows
  4. All of the financial statements include credit sales.
  5. None of these financial statements includes credit sales.
Explanation
Answer - C - The statement of cash flows does not record sales that are recorded as credit.

Key Takeaway: The income statement and the balance sheet both show net income, which includes cash sales and sales on credit. The statement of cash flows does not include future incoming and outgoing cash that is recorded on credit.
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