Asked by Alianna Jiminian on May 08, 2024
Verified
Explain how the cash flows from operating activities section of the statement of cash flows is prepared using the direct method.
Operating Activities
The primary revenue-generating activities of an organization, including the production, sales, and delivery of its products and services.
- Calculate and analyze cash flow from operations using both the direct and indirect methods.
Verified Answer
KS
Keleque SmithMay 09, 2024
Final Answer :
The direct method for reporting cash flows provided or used by operations (which is recommended by the IASB) involves listing separately the major items of operating cash inflows and cash outflows. The operating cash outflows are then subtracted from operating cash inflows to obtain the net inflow or net outflow of cash.
Learning Objectives
- Calculate and analyze cash flow from operations using both the direct and indirect methods.
Related questions
The Cash Flows from Operating Activities Are Reported by the ...
Selected Data for the Current Year Ended December 31 Are ...
A Company Calculates Its Cash Flows from Operating Activities as ...
A Reconciliation of Profit or Loss and Cash Flows Is ...
The Records of Amy's Flowers Showed Net Loss, $20,000; Depreciation ...