The Direct Method of Preparing the Statement of Cash Flows

question 10

Multiple Choice

The direct method of preparing the statement of cash flows

• A)results in more cash from operating activities,but less cash from investing activities,and the same total cash flow as the indirect method.
• B)converts each item on the income statement to its cash equivalent.
• C)reports interest and dividends received in the investing activities section.
• D)All of these choices.

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Definitions:

Reactance Theory

A psychological theory suggesting that people act against threats to their freedoms or choices to maintain a sense of control.

Psychodynamic Theory

A psychological perspective that emphasizes unconscious processes and childhood experiences in shaping behavior and personality.

Systems Theory

An interdisciplinary theory that analyzes systems—a set of interacting or interdependent components—as a whole to understand problems, make predictions, and guide improvements.

Cognitive Behavioral Therapy

Cognitive Behavioral Therapy (CBT) is a psychotherapeutic intervention that aims to improve mental health by challenging and changing unhelpful cognitive distortions and behaviors, improving emotional regulation, and developing personal coping strategies.