When preparing the operating activities section of the statement of cash flows using the direct method,revenues and gains with no cash inflows are added back to net income.

Question

Quizplus · Accepted Answer

In the direct method of preparing the operating activities section of the statement of cash flows, only actual cash receipts and cash payments are reported, so revenues and gains with no cash inflows are not added back to net income.

When Preparing the Operating Activities Section of the Statement of Cash