At the End of the Process of Entry and Exit

question 150

True/False

At the end of the process of entry and exit, it is possible that some firms in a competitive market are making positive economic profit.

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Definitions:

Indirect Approach

A method used in accounting to prepare the cash flow statement, where non-cash activities are adjusted to net income to calculate cash flow from operating activities.

Direct Approach

A method of communication in which the main point or message is presented at the beginning, followed by supporting details.

Investing Activities

are financial transactions related to the acquisition or sale of long-term assets and investments outside the normal scope of business operations.

Financing Activities

Activities that result in changes in the size and composition of the contributed equity and borrowings of the entity, as shown in its cash flow statement.