Chapter 12, Problem 5DQ

To determine

Cash Flow Statement:

Cash flow statement is that statement in which, transaction related to cash are recorded. It is mandatory report and included in the financial statement of the company. It is divided into three parts operating activities, investing activity, and financial activity

Operating Activity:

Operating activity is the first part of the cash flow statement. The main focuses of the operating activity on the cash inflow and outflow from the selling goods, providing services and manufacturing goods. Long term capital and investing cost are not included in the operating activity.

To identify: The operating activities reported on the cash flow statement under direct method.