In preparing the operating activities section of the statement of cash flows by the indirect method,noncash revenues and gains are added to net income.

Question

Quizplus · Accepted Answer

Noncash revenues and gains are not added to net income in the operating activities section of the statement of cash flows by the indirect method. Instead, they are separately disclosed and adjusted for in the reconciliation of net income to net cash provided by operating activities.

In Preparing the Operating Activities Section of the Statement of Cash