Starting with net income and adjusting it for items that affected reported net income but which did not affect cash is called the
A) direct method.
B) indirect method.
C) cost-benefit method.
D) working capital method.

Question

Quizplus · Accepted Answer

Adjusting net income for items that affected reported net income but did not affect cash is the purpose of the indirect method of cash flow statement preparation.

Starting with Net Income and Adjusting It for Items That