Which of the following items would be reported on a statement of cash flows using the indirect method,but not on a statement prepared using the direct method?
A) Cash paid for dividends
B) Cash received from stock issuances
C) Depreciation
D) Cash paid for purchase of treasury stock

Question

Quizplus · Accepted Answer

Depreciation would be reported on the cash flow statement using the indirect method but not on a statement prepared using the direct method because the indirect method starts with accrual accounting net income and adjusts for non-cash items such as depreciation, while the direct method reports actual cash inflows and outflows.

Therefore, options A, B, and D would be reported on both the indirect and direct method statements because they are actual cash transactions.

Which of the Following Items Would Be Reported on a Statement