Which of the following statements about the cash flow statement is FALSE?
A)The indirect method begins with profit and adjusts to calculate operating cash flows.
B)Both the direct and indirect methods include three types of cash flows.
C)The operating activities section of both the direct and the indirect method is the same.
D)The indirect method and the direct method will produce the same amount of cash flow.

Question

Quizplus · Accepted Answer

The operating activities section differs between the direct and indirect methods; the direct method lists cash receipts and payments, while the indirect method adjusts net income for non-cash items and changes in working capital.

Which of the Following Statements About the Cash Flow Statement