Presented below is the operating activities section of a statement of cash flows for 2014: Which method of preparing the operating activities section was 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 a statement of cash flows for 2014:  Which method of preparing the operating activities section was used?
A)The direct method. 
B)The indirect method. 
C)Either method. 
D)Cannot be determined without further information.

Quizplus · Accepted Answer

The statement shows adjustments to net income for non-cash expenses, changes in current assets and liabilities, and amortization and depreciation expenses, which are all characteristics of the indirect method.

Presented Below Is the Operating Activities Section of a Statement