The indirect and direct methods Multiple Choice Are two allowable methods to present operating activities in the statement of cash flows. Affect the presentations of operating, investing, and financing activities. Arrive at different amounts for net cash flows from operating activities. Are used by companies about equally in actual practice.

Are two allowable methods to present operating activities in the statement of cash flows.

Explanation:

As we know that the cash flow statement is a statement that shows the cash inflows and cash outflow of the organization

For this statements, there are two methods to determine

The one is direct method

And, the other one is indirect method

Both are acceptable only the calculation made in operating activities is change and for rest two activities i.e. investing and financing would be the same under these two methods

Therefore the first option is correct

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