Question

Suppose CO company uses the indirect method to prepare the cash flow statement. Indicate which of the following items will appear in the cash flow from the operating activities section of the cash flow statement. [Tick all that apply].

		Software development costs capitalized
		Provision for impairments and asset disposals
		Share based compensation expense
		Uncollectible accounts receivables written oF
		Cash paid to purchase available-for-sale securities
		Cash received from sale of company’s own long-term bonds
		Dividends received from companies accounted by equity method.

Answer 1

The following items will appear in the cash flow:

1) Provision for impairments and asset disposal

2) Dividends received from companies accounted by equity method

3) Uncollectible accounts receivables written off

4) Cash paid to purchase available for sale securities

5) Cash received from sale of company's own long term bonds

6) Share based compensation expenses