When a Company Uses the Direct Method to Determine the Net

question 91

Multiple Choice

When a company uses the direct method to determine the net cash flow from operating activities,cash flows from operating activities will:

• A)be identical to the amount reported using the indirect method.
• B)be larger if there is a net cash inflow and smaller if there is a net cash outflow compared to the amount reported using the indirect method.
• C)always be larger than the amount reported using the indirect method.
• D)be larger if there is a net cash outflow and smaller if there is a net cash inflow compared to the amount reported using the indirect method.

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Definitions:

Data Mart

A subset of a data warehouse, focused on a specific line of business, department, or subject area, making it easier to retrieve relevant data.

Data Mining

The process of discovering patterns and knowledge from large amounts of data.

Reporting

The process of organizing data into informational summaries in order to monitor how different areas of a business are performing.

Information System

A system that includes data, people, procedures, hardware, and software that help in planning and decision making; a software-based solution used to gather and analyze information.