Regarding the Use of a Spreadsheet for the Preparation of the Statement

question 58

Multiple Choice

Regarding the use of a spreadsheet for the preparation of the statement of cash flows,which of the following statements is TRUE?

• A) The T-account approach works well for all companies.
• B) The statement of cash flows cannot be prepared directly from the spreadsheet because additional information is needed.
• C) The spreadsheet is needed when companies face complex situations.
• D) The spreadsheet can only be used if the indirect method for operating activities is also used.

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Definitions:

Unit Prices

Unit prices are the costs assigned to a single unit of a product or service, allowing buyers to compare costs and make informed purchasing decisions.

Beginning Inventory

The cost of items on hand ready for sale at the opening of an accounting cycle.

Merchandise

This refers to goods or stock that a retail store has on hand to sell to customers, effectively the items available for sale in a commercial setting.

Purchases

Transactions involving the acquisition of goods or services in exchange for payment, for the purpose of operating a business.