Which Method of Preparing the Operating Activities Section of a Cash

question 36

Essay

Which method of preparing the operating activities section of a cash flow statement is recommended by the Financial Accounting Standards Board?

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Definitions:

Discretionary Income

the portion of an individual's income available for spending after the essentials (like food, shelter, and clothing) have been taken care of.

Household Budget

An estimation of revenue and expenses over a specified period for a home, serving as a plan for personal financial management.

Monthly Expenses

refer to the total costs incurred on a regular monthly basis for personal or business purposes.

Monthly Income

The total amount of income a person or household receives in a month, from all sources.