Assume a Company Uses the Direct Method to Prepare Its

question 26

Multiple Choice

Assume a company uses the direct method to prepare its statement of cash flows.If the company's accounts receivable increase during the accounting period,the change in accounts receivable is:

• A)added to the change in the cash account to calculate cash collected from customers.
• B)subtracted from sales revenue to calculate the cash collected from customers.
• C)added to sales revenue to calculate the cash collected from customers.
• D)subtracted from the change in the cash account to calculate cash collected from customers.

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Definitions:

Two-tier System

A societal or organizational system where two distinct classes or groups have varying access to resources, rights, or services.

Socialized Health Insurance

A system where the government or a public agency provides health insurance to all citizens, typically funded through taxation.

Nationalized Health Care

A system where the government provides and manages health care services and insurance, aiming to ensure access for all citizens.

Limited Mobility

Refers to a person's or population's restricted ability to move freely, often due to physical disabilities, infrastructure, or socio-economic barriers.