How does the direct method differ from the indirect method?How does the choice of methods impact the amount of net cash flow from operating activities?

What will be an ideal response?


The direct method shows the specific sources and uses of cash that are associated with operating activities. It does not show adjustments to net income. The amount of net cash flow from operating activities is the same whether it is presented using the indirect or the direct method.

Business

You might also like to view...

Liquidation of a partnership usually means that assets are sold, liabilities are paid, and remaining cash is distributed to the partners

a. True b. False Indicate whether the statement is true or false

Business

Answer the following statements true (T) or false (F)

1. A company cannot report a gain or loss when buying or selling its own stock. 2. When a corporation issues no-par stock, it debits the asset received and credits the stock account. 3. Paid-in capital in excess of par is recorded when no-par stock is issued. 4 Accounting for stated value common stock is identical to accounting for par value stock. 5. A corporation issues 16,000 shares of its $3 stated value common shares. The issue price is $9 per share. The credit to the Common Stock account is $144,000.

Business

Compare and contrast the two methods that may be used to present operating cash flows in the statement of cash flows. Which method is preferred by firms and by outsiders?

What will be an ideal response?

Business

The belief that a person’s personality is the result of a number of innate characteristics is typical of which approach to personality?

a. Socio-cognitive b. Psychoanalytic c. Trait d. Humanist

Business