When Preparing the Operating Activities Section of the Statement of Cash

question 196

True/False

When preparing the operating activities section of the statement of cash flows using the direct method, non-operating gains are added to net income.

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Definitions:

Capitalism

An economic system based on private ownership of the means of production and characterized by competition, profit motive, and market-driven allocation of resources.

Profit

The financial gain made in a transaction or through the operation of a business, calculated as the excess of revenues over expenses.

Alienated

describes a state of feeling estranged or disconnected from people, work, or society at large.

Industrial Production

The process of manufacturing goods in large quantities using machinery and industrial methods.