Which Method of Preparing the Statement of Cash Flows Is

question 78

Multiple Choice

Which method of preparing the statement of cash flows is similar to an income statement prepared on a cash basis?

• A)Single-step method
• B)Indirect method
• C)Multiple-step method
• D)Direct method

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Definitions:

Labor Hour Rate

The cost associated with labor per hour worked, used in calculating the cost of producing goods or services.

Job

A specific task or project, often within the context of job order production, where products are made to order.

Materials Price Variances

The difference between the actual cost of materials used in production and the standard or expected cost, indicating if materials were more or less expensive than planned.

Quantity Variances

Quantity variances refer to the difference between the actual quantity of materials or labor used and the expected quantity needed for production.