On the statement of cash flows, the direct method starts with accrual income and adjusts it for the non-cash items it contains.

Name: On the statement of cash flows, the direct method starts with accrual income and adjusts it for the non-cash items it contains.
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The direct method of preparing a statement of cash flows starts with cash receipts from customers and deducts cash payments to suppliers and employees, rather than starting with accrual income and adjusting for non-cash items.

On the Statement of Cash Flows, the Direct Method Starts