The Statements on Auditing Standards Have Been Issued by The

question 38

Multiple Choice

The Statements on Auditing Standards have been issued by the:

• A)Auditing Standards Board.
• B)Financial Accounting Standards Board.
• C)Securities and Exchange Commission.
• D)Federal Bureau of Investigation.

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Definitions:

Indirect Method

A method used in cash flow statements to adjust net income for the changes in non-cash accounts to arrive at operating cash flow.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within a year or within the operating cycle of a business.

Fixed Assets

Tangible assets, such as property, plant, and equipment, used in the operating activities of a business and not intended for sale in the normal course of business.

Indirect Method

A way of calculating cash flows for the cash flow statement where net income is adjusted for changes in balance sheet accounts to reflect cash operations.