ACCT 2001 Ch. 12 Vocab

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5 Terms

1
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cash flows from financing activities

cash inflows and outflows related to financing sources external to the company

2
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cash flows from investing activities

cash inflows and outflows related to the sale or purchase of investments and long-lived assets

3
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cash flows from operating activities

cash inflows and outflows related to components of net income

4
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direct method

a method of presenting the operating activities section of the statement of cash flows

  • reports the components of cash flows from operating activities as gross receipts and gross payments

5
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indirect method

presents the operating activities of the cash flow statement by adjusting net income to compute cash flows from operating activities