Under the Direct Method of Preparing the Statement of Cash

question 57

Multiple Choice

Under the direct method of preparing the statement of cash flows, to determine collections from customers:

• A)beginning accounts receivable is subtracted from sales.
• B)ending accounts receivable is added to sales.
• C)the net change in accounts receivable is added or subtracted from sales.
• D)none of the above is true.

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Definitions:

Competitive Advantage

The unique attributes or capabilities that allow a company to outperform its competitors, creating greater value for its customers.

Product Attributes

Characteristics of a product that include specifications, features, and benefits that appeal to the market.

Advantageous Use

Utilizing a resource, skill, or opportunity in a way that maximizes benefits or produces a favorable outcome.

Product Price

The amount of money required to purchase a product, determined by various factors including production costs, market demand, and competition.