The Direct Method of Preparing the Statement of Cash Flows

question 78

Multiple Choice

The direct method of preparing the statement of cash flows

• A)is preferred by IASB and FASB.
• B)is the same as the indirect method with the exception of the cash account.
• C)is an accumulation of net income accounts so that accountants can locate discrepancies in balances.
• D)omits the financing section of the statement.
• E)focuses on cash outflows over cash inflows.

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Definitions:

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