The Main Disadvantage of the Direct Method of Reporting Cash

question 97

True/False

The main disadvantage of the direct method of reporting cash flows from operating activities is that the necessary data are often costly to accumulate.

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Definitions:

Owner Withdraw

Transactions where the owners withdraw cash or other assets from the business for personal use.

Capital

Financial assets or the financial value of assets, such as cash, that can be used to fund business operations or investments.

Unit Of Measurement

A definite magnitude of a quantity, defined and adopted by convention or by law, used as a standard for measurement of the same kind of quantity.

Economic Data

Information concerning the economy of a region or country, including information about production, consumption, employment, inflation, and GDP.