Regarding the Direct and Indirect Methods of Preparing the Statement

question 136

Multiple Choice

Regarding the direct and indirect methods of preparing the statement of cash flows,which of the following statements is TRUE?

• A) The indirect method and the direct method will produce a different amount of net cash provided by investing activities.
• B) The indirect method starts with net income and adjusts it to net cash provided by (used for) operating activities.
• C) The direct and indirect methods include different types of cash flows in the investing activities section.
• D) The indirect method includes all non-cash activities, whereas the direct method includes only the cash activities.

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Definitions:

B. F. Skinner

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