When a Company Uses the Direct Method to Determine the Cash

question 5

Multiple Choice

When a company uses the direct method to determine the cash flows from operating activities,cash flows from operating activities will:

• A)be identical to the amount reported using the indirect method.
• B)be larger if there is a net cash inflow and smaller if there is a net cash outflow compared to the amount reported using the indirect method.
• C)always be larger than the amount reported using the indirect method.
• D)be larger if there is a net cash outflow and smaller if there is a net cash inflow compared to the amount reported using the indirect method.

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Definitions:

Foot Drop

A gait abnormality in which the dropping of the forefoot happens due to weakness, irritation or damage to the peroneal nerve, or paralysis of the muscles in the anterior portion of the lower leg.

Trochanter Rolls

Cylindrical devices placed beside the hips or legs to prevent external rotation and support the limbs' proper alignment.

Dorsiflex

The action of raising the foot upwards towards the shin, decreasing the angle between the dorsum (upper surface) of the foot and the leg.

Foot Boots

Protective footwear designed to shield the feet from harm during various activities or as part of treatment for foot-related conditions.