Which of the Following Statements Is Incorrect Regarding the Statement

question 3

Multiple Choice

Which of the following statements is incorrect regarding the statement of cash flows?

• A)The direct and indirect methods always produce the same amount of cash flows from operating activities.
• B)The direct method presentation of operating cash flows is more straightforward than that of the indirect method.
• C)The indirect method is more difficult to implement in practice.
• D)When the direct method is presented,preparation and disclosure of the indirect method of presenting cash flows from operating activities is also required.

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Definitions:

Last Month

A reference to the immediate month preceding the current one.

Variable Overhead Rate Variance

The difference between the actual variable overhead incurred and the standard variable overhead expected, based on the actual activity level.

Variable Overhead

Indirect, fluctuating costs that change with the level of production or organizational activity.

Direct Labor-hours

The aggregate amount of time spent by staff directly participating in the production process or in service provision.