Which of the following statements concerning the statement of cash flows is true?
A)The statement of cash flows is usually more accurate when using the indirect method.
B)If the direct method is used, gains and losses on sale of equipment are not shown.
C)The statement of cash flows reports earnings per share.
D)The statement of cash flows is an optional financial statement for external reporting purposes.

Question

Quizplus · Accepted Answer

Under the direct method, gains and losses on sale of equipment are not shown separately in the operating section. Rather, these gains and losses are typically included in the cash inflows or outflows from the sale of equipment in the investing section. The other statements are false.

Which of the Following Statements Concerning the Statement of Cash