In Creating a Cash Flow Statement Using the Indirect Method,a

question 61

True/False

In creating a cash flow statement using the indirect method,a gain on the sale of non-current assets must be shown as an addition to Profit in the operating activities section.

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Definitions:

LIFO

Last In, First Out (LIFO) is an inventory valuation method which assumes that the most recently produced items are the first to be sold.

Units

In accounting and finance, refers to a measure of quantity or volume of production or inventory.

Specific Identification

An inventory costing method in which costs are assigned to individual items or batches of items, not to inventory as a whole.

Cost of Goods Sold

This refers to the aggregate expense involved in creating a product that a company sells, including direct labor, material costs, and direct factory overhead.