When reading the Cash Inflows from Operating Activities portion of the statement of cash flows using the direct method, you would expect to find which of the following? I. Collections from customers
II) Interest and dividends collected
III) Other operating receipts
IV) Receipts from shareholders
A) I
B) I and IV
C) I, II, and III
D) I, II, III, and IV

Question

Quizplus · Accepted Answer

The direct method of reporting cash flows from operating activities includes collections from customers (I), interest and dividends collected (II), and other operating receipts (III). Receipts from shareholders (IV) are financing activities, not operating activities.

When Reading the Cash Inflows from Operating Activities Portion of the Statement