A Cash Flow Statement Reports Cash Receipts and Disbursements for a Firm

question 33

Multiple Choice

A cash flow statement reports cash receipts and disbursements for a firm that results:

• A)from its operations,investments,and financing.
• B)only from its operations.
• C)from both its operations and investments,but not from its financing.
• D)only from its investments.

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Definitions:

Indirect Method

A way of preparing the cash flow statement where net income is adjusted for non-cash transactions, indirect expenses, and changes in working capital.

Depreciation Expense

A technique in accounting that involves spreading out the expense of a physical asset over its expected lifespan.

Depreciation Expense

The allocated cost of an asset over its useful life as an expense in accounting.