Which of the Following Transactions or Events Should Be Reported

question 50

Multiple Choice

Which of the following transactions or events should be reported as a source of cash from operating activities when using the direct method?

• A)Credit sales.
• B)Cash collections from customers.
• C)Depreciation expense.
• D)Cash received from the sale of a building.
• E)Cash received from the sale of treasury stock.

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Definitions:

Quality of Service

The assessment of how well a delivered service matches the expectations of the customer.

Common Cost

A cost that is not directly attributable to any particular cost object, such as a product, department, or project.

Business Unit

A segment of a company with its distinct operations and management, often treated as an individual entity within the larger corporation for strategic and operational planning.

Avoidable

Something described as avoidable can be prevented or not incurred if certain actions are taken or certain conditions are met.