Direct method: It reports cash receipts and disbursements arising out of operating activities. Difference between these amounts helps us arrive at the net cash flows from operating activities. Given information: B Corporation’s income statement for 2017 has been provided in the question. To prepare: Prepare cash flows from operating activity (direct method.)

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Chapter 23, Problem 4BE

To determine

Direct method: It reports cash receipts and disbursements arising out of operating activities. Difference between these amounts helps us arrive at the net cash flows from operating activities.

Given information: B Corporation’s income statement for 2017 has been provided in the question.

To prepare: Prepare cash flows from operating activity (direct method.)

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