All of the Following Statements Related to Preparation of the Statement

question 100

Multiple Choice

All of the following statements related to preparation of the statement of cash flows are true except:

• A)A company may report cash flows from operating activities using either the direct or indirect method.
• B)Interest expense may be reported under operating or financing based on which one results in better cash flows.
• C)Cash dividends paid to shareholders are classified as a financing activity.
• D)Purchase of an intangible asset is classified as an investing activity.
• E)Repaying the principal of notes payable is classified as a financing activity.

---

Definitions:

Context

The environment in which communication takes place.

Physical Environment

The physical environment encompasses all the external, tangible surroundings in which an organism lives, including both natural and built environments.

Personal Space

A zone of space surrounding a person that is felt to “belong” to that person.

Communication Process

The communication process is the sequence of steps through which information is conveyed from a sender to a receiver, encompassing message creation, transmission, reception, and interpretation.