starts with net profit & converts it to operating cash flow by adjusting for items that didn't affect cash.

Direct method

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Accrual Method

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Cash Method

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Indirect method

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Solution

The correct option is D Indirect method
Indirect method starts with net profit & converts it to operating cash flow by adjusting for items that didn't affect cash. The direct method converts each item on the income statement to a cash basis.

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Similar questions

This method starts with net income and converts it to operating cash flow by adjusting for items that were used to calculate net income but did not affect cash. This method is …..

The method for presenting net cash provided by operating activities that starts with net income and adjusts it for items that affected reported net income but that did not affect cash is called the ____________.

Q. Under indirect method, which of the following items must be deducted from reported net income to determine net cash flow from operating activities?

Which of the following items would be subtracted from net income when using the indirect method of calculating cash flows provided by operating activities?

Depreciation expenses are _________ to net profit while calculating cash flow from operating activities.

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starts with net profit & converts it to operating cash flow by adjusting for items that didn't affect cash.

The correct option is D Indirect methodIndirect method starts with net profit & converts it to operating cash flow by adjusting for items that didn't affect cash. The direct method converts each item on the income statement to a cash basis.

The correct option is D Indirect method
Indirect method starts with net profit & converts it to operating cash flow by adjusting for items that didn't affect cash. The direct method converts each item on the income statement to a cash basis.