Presented below is the operating activities section of the statement of cash flows for Golden Consulting for 2016: Which method of preparing the operating activities section has Golden Consulting used?
A)The direct method.
B)The indirect method.
C)Either method.
D)Cannot be determined without further information.

Question

Presented below is the operating activities section of the statement of cash flows for Golden Consulting for 2016:  Which method of preparing the operating activities section has Golden Consulting used?
A)The direct method. 
B)The indirect method. 
C)Either method. 
D)Cannot be determined without further information.

Quizplus · Accepted Answer

The statement of cash flows includes adjustments to net income for non-cash items and changes in working capital accounts. The presentation of changes in working capital accounts is based on the indirect method.

Presented Below Is the Operating Activities Section of the Statement