Statement 1: Investments by the owners are reported as an investing activity on the statement of cash flows. Statement 2: The activity from the balance sheet to be presented in the financing activities section of the statement of cash flows is based on an analysis of stockholders' equity only.

A. Both statements are true

B. Both statements are false

C. Only statement 1 is true

D. Only statement 2 is true

Please provide a comprehensive explanation for your answer.