When using the indirect method to prepare the operating section of a statement of cash flows, which of the following is added to net income to compute cash provided by/used by operating activities? Amortization of patent. Gain on sale of land. All of these are added to net income to arrive at cash flow from operating activities. Increase in accounts receivable.

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Q: Under the Indirect Method what must be disclosed on a Statement of Cash Flows?

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A: Here is the Answer

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A:

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A: Current assets can be exchanged for cash within a year.

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Q: tion exp

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Q: Determine cash flows from operating activities by the direct method.

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Financial Transaction Analysis

The transaction analysis is done with the help of the accounting equation. The basic accounting equation is alternatively known as the balance sheet equation is based on the double-entry system which says that for each transaction happening in a business, at least two accounts should be affected I.e. both the debit side and the credit side should be equal. The Accounting Equation is