To compare statement of cash flows reporting under the direct and indirect metho

Question

To compare statement of cash flows reporting under the direct and indirect methods, select "Direct", "Indirect" or "Both" indicating the method in which the line items are reported on the statement of cash flows.

Cash Flows (and Related Changes) Statement of Cash Flows Method
1. Net income
2. Receipts from customers
3. Accounts receivable increase or decrease
4. Payments to suppliers
5. Inventory increase or decrease
6. Accounts payable increase or decrease
7. Payments to employees
8. Wages payable, increase or decrease
9. Depreciation expense
10. Cash flows from operating activities
11. Cash flows from investing activities
12. Cash flows from financing activities
13. Net increase or decrease in cash during the period

* you are going to get statement of cash flows method(choose one of direct, indirect, both)

Explanation / Answer

Cash Flow Statement

Indirect Methode

Cash Flow Statement

Indirect Methode

Cash Flow from Operating Activities: Net Income ++++ Accounts Receivable Increased / Decreased +++ Inventory Increased / Decreased +++ Accounts Payble Increased / Decreased +++ Wages Payble Increased / Decreased +++ Depreciation Expenses +++ ++++ Net Cash Flow from Operating Activities - (A) ++++ Cash Flow from Investing Activities - (B) ++++ Cash Flow from Financing Activities - ( C ) ++++ Net Increase / Decrease in cash during the periode - (A+B+C) ++++ Add: Opening cash balance +++ Closing Cash +++++

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