When preparing the operating activities section of the statement of cash flows using the direct method, net income must be adjusted for gains or losses realized when property, plant, and equipment is sold.
Answer the following statement true (T) or false (F)
False
The direct method converts revenues to cash inflows and expenses to cash outflows. Since a gain is a noncash revenue and a loss is a noncash expense, they would not appear in the operating activities section of the statement of cash flows prepared using the direct method.
You might also like to view...
On January 1, a company issued and sold a $400,000, 7%, 10-year bond payable, and received proceeds of $396,000. Interest is payable each June 30 and December 31. The company uses the straight-line method to amortize the discount. The carrying value of the bonds immediately after the first interest payment is:
A. $399,800. B. $400,000. C. $400,200. D. $395,800. E. $396,200.
Which of these does not violate the Fair Debt Collection Practices Act? The debt collector:
a. claims to be an attorney when talking to the debtor b. publishes a list of actual debtors in the newspaper c. threatens to beat up the debtor d. calls the debtor's employer to discuss the matter e. all of the other choices are illegal
When effectively practiced, _____allows every aspect of an organization to operate at peak levels.
a) total quality b) empowerment c) process improvement d) freedom through control
A distributed database is a single logical database spread physically across computers in multiple locations that are connected by a data communications link
Indicate whether the statement is true or false