Assume That the Direct Method Is Used to Prepare the Operating

question 79

Multiple Choice

Assume that the direct method is used to prepare the operating activities section of the statement of cash flows.Which related balance sheet account will explain the difference between revenues on the income statement and cash collected from customers?

• A)Inventory
• B)Accounts Payable
• C)Cost of Goods Sold
• D)Accounts Receivable

---

Definitions:

Ethical Philosophy

The branch of philosophy that involves systematizing, defending, and recommending concepts of right and wrong behavior.

Whistleblowing

Turning in or otherwise exposing people who behave unethically in your company.

Western Developed World

Countries in the Western hemisphere that are considered developed due to their advanced economies, technologies, and standard of living.

Cultural Ideals

Shared beliefs or values within a society regarding what is considered desirable or preferable behavior, traits, or ways of life.