The only part that differs in a statement of cash flows prepared by the direct method from one prepared by the indirect method is the ________.
A) financing activities section
B) investing activities section
C) operating activities section
D) non-cash investing and financing activities section

Question

Quizplus · Accepted Answer

The only part that differs in a statement of cash flows prepared by the direct method from one prepared by the indirect method is the operating activities section. In the direct method, operating cash inflows and outflows are directly reported, while in the indirect method, they are derived from adjustments to net income. The financing activities section, investing activities section, and non-cash investing and financing activities section are presented in the same way in both methods.

The Only Part That Differs in a Statement of Cash