The Direct Method for the Preparation of the Statement of Cash

question 163

Multiple Choice

The direct method for the preparation of the statement of cash flows ________.

• A)is required by the FASB
• B)is in conformity with GAAP
• C)is the preferred method used by most businesses
• D)is required by the IASB

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Definitions:

Debt Finance

A method of financing where funds are borrowed and are expected to be paid back with interest.

Equity Finance

A method of raising capital through the sale of shares in a company, giving shareholders ownership interests.

Bond Owners

Individuals or entities that hold the debt securities issued by corporations or governments, earning interest over time.

Equity Finance

The method of raising capital through the sale of shares in a company, giving shareholders ownership interests.