Under the indirect method,instead of reporting cash receipts and payments,net income is reconciled with net cash from operating activities.

Question

Quizplus · Accepted Answer

This statement is true. The indirect method of preparing the cash flow statement starts with net income and then makes adjustments to reconcile it with net cash from operating activities. This is done by adding back non-cash expenses and deducting non-cash revenues and adjusting for changes in current assets and current liabilities.

Under the Indirect Method,instead of Reporting Cash Receipts and Payments,net