Comparing the Direct and Indirect Methods
To compare statement of cash flows reporting under the direct and indirect methods, enter check marks to indicate which items are used with each method.
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| STATEMENT OF CASH FLOWS METHOD | |
Cash Flows (and Related Changes) | Direct | Indirect | |
1. | Accounts payable increase or decrease |
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2. | Payments to employees |
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3. | Cash collections from customers |
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4. | Accounts receivable increase or decrease |
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5. | Payments to suppliers |
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6. | Inventory increase or decrease |
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7. | Wages payable, increase or decrease |
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8. | Depreciation expense |
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9. | Net income |
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10. | Cash flows from operating activities |
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11. | Cash flows from investing activities |
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12. | Cash flows from financing activities |
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13. | Net increase or decrease in cash during the period |
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