Using the Direct Method to Determine Cash Flows from Operations,start

question 15

True/False

Using the direct method to determine cash flows from operations,start with net income,then add back all expenses not paid in cash and subtract all revenues that do not provide cash.

---

Definitions:

Non-selling Times

Periods when sales activities are not being conducted, which can include planning, research, and administrative tasks.

Gross Profit

This is the financial gain made after subtracting the cost of goods sold from the revenue generated from sales, before deducting any operational expenses.

Sales Revenue

The total income generated from the sale of goods or services before any costs or expenses are deducted.

Costs Of Goods Sold

An accounting term that denotes the direct costs attributable to the production of the goods sold by a company.