The difference between the direct and indirect methods of computing the cash flow statement occurs in the:
A) financing activities section.
B) operating activities section.
C) investing activities section.
D) managing activities section.

Question

Quizplus · Accepted Answer

The difference between the direct and indirect methods of computing the cash flow statement occurs in the operating activities section. The direct method lists all cash receipts and payments, while the indirect method starts with net income and adjusts for non-cash transactions.

The Difference Between the Direct and Indirect Methods of Computing