If the Direct Method Is Used to Prepare a Statement

question 20

Multiple Choice

If the direct method is used to prepare a statement of cash flows,credit sales may not automatically create a cash inflow because

• A)some receivables may be uncollectible.
• B)sales from a prior period may be collected in the current period.
• C)sales from the current period may be collected in a future period.
• D)All of these choices.

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Definitions:

Hypothetical Scenarios

Imagined or theoretical situations used for the purpose of analysis, discussion, or decision-making.

Media Content

Refers to the information, entertainment, or other material that is produced and shared through various platforms like TV, radio, internet, and print media.

Home-Based

Activities or businesses operated from someone's residence, as opposed to an external office or commercial space.

Situation Comedy

A television or radio series that revolves around the humorous daily lives of its characters.