What is the key difference between the direct method and indirect method for preparing the Statement of Cash Flows?
A)presentation of Cash from Operations
B)presentation of Cash from Investing
C)presentation of Cash from Financing
D)presentation of Cash from Investing and Cash from Financing
E)presentation of Cash from Operations, Cash from Investing and Cash from Financing

Question

Quizplus · Accepted Answer

The key difference between the direct method and indirect method is in the presentation of Cash from Operations. The direct method presents actual cash inflows and outflows from operating activities, while the indirect method starts with net income and adjusts for non-cash items to arrive at cash from operations. The other options listed refer to the presentation of Cash from Investing and Cash from Financing, which are presented in the same way under both methods.

What Is the Key Difference Between the Direct Method and Indirect