All of the Following Statements Related to Reporting Cash Flows

question 1

Multiple Choice

All of the following statements related to reporting cash flows from investing and financing activities are true except:

• A)Reporting of financing activities is the same under the direct method and indirect method.
• B)Changes in noncurrent liability accounts and equity accounts are analyzed to determine cash flows from financing activities
• C)Changes in noncurrent asset accounts,current notes receivable,and current investments are analyzed to determine cash flows from investing activities.
• D)The direct method applies accrual accounting while the indirect method applies cash basis accounting.
• E)Reporting of investing activities is the same under the direct method and indirect method.

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Definitions:

Unfavourable Direction

A situation or trend that is not advantageous or beneficial, potentially leading to adverse outcomes or failure.

Multidimensional Thinking

The ability to analyze and approach problems from multiple perspectives and dimensions, recognizing various factors and potential impacts.

Time Horizons

The length of time over which an investment, project, or policy is intended or expected to operate or have an effect.

Problem Solving

The process of identifying a problem, generating solutions, and implementing an action plan to resolve the issue.