Forrest Gardner, owner of Gardner's Gardens, just completed his first year in business and has received financial statements that have been prepared by his accountant. Gardner finds the income statement and balance sheet to be informative, however, he does not understand the statement of cash flows. He says that the first section is especially confusing.

Write a summary explaining the following:

1. Purpose and sections of the cash flow statement.

2. Explain why the first section may be confusing.