Under the Direct Method of the Statement of Cash Flows

question 10

Multiple Choice

Under the direct method of the statement of cash flows, a sale of merchandise inventory for cash is a(n) :

• A) managing activity.
• B) investing activity.
• C) financing activity.
• D) operating activity.

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Definitions:

Command Economy

A type of economic system where the government or a central authority makes all decisions regarding the production and distribution of goods and services.

Central Government

The government entity or authority that holds the highest level of governance within a nation, responsible for national policies and administration.

Consumer Sovereignty

The theory that consumer preferences and choices dictate the production and sale of goods and services in a market.

Laissez-Faire Economy

An economic system where transactions between private parties are free from government intervention such as regulations, privileges, tariffs, and subsidies.