The Indirect Method for the Preparation of the Operating Activities

question 52

Multiple Choice

The indirect method for the preparation of the operating activities section of the statement of cash flows:

• A)Separately lists each major item of operating cash receipts.
• B)Separately lists each major item of operating cash payments.
• C)Reports net income and then adjusts it for items necessary to determine net cash provided or used by operating activities.
• D)Is required if the company is a merchandiser.
• E)Must not be used in all circumstances.

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Definitions:

Random Samples

Selections made in such a way that each member of a population has an equal chance of being included in the sample.

Temporary Worker Productivity

The efficiency and output of workers employed on a temporary basis, often measured in terms of contributions to specific projects or tasks.

Normally Distributed

A probability distribution characterized by a symmetrical bell-shaped curve, where mean, median, and mode are equal.

Probability

The probability or possibility of an event happening.