A Major Disadvantage of the Indirect Method of Reporting Cash

question 176

True/False

A major disadvantage of the indirect method of reporting cash flows from operating activities is that the difference between the net amount of cash flows from operating activities and net income is emphasized.

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Definitions:

Electrical Problems

Issues related to electrical systems and components, characterized by faults or malfunctions in wiring, devices, or circuits, often requiring professional diagnosis and repair.

Plumbing Problems

Issues related to the systems that convey water in a building for heating, cleaning, and drinking, along with the removal of waterborne wastes.

Creditor

An individual or entity to whom money is owed by another party, known as the debtor.

Mortgage

A legal agreement by which a bank or creditor lends money at interest in exchange for taking title of the debtor's property, with the condition that the conveyance of title becomes void upon the payment of the debt.