What is the direct and indirect methods


To compare statement of cash flows reporting under the direct and indirect methods, select "Direct", "Indirect" or "Both" indicating the method in which the line items are reported on the statement of cash flows.

Cash Flows Statement of Cash Flows Method
1. Net income
2. Receipts from customers
3. Accounts receivable increase or decrease
4. Payments to suppliers
5. Inventory increase or decrease
6. Accounts payable increase or decrease
7. Payments to employees
8. Wages payable, increase or decrease
9. Depreciation expense
10. Cash flows from operating activities
11. Cash flows from investing activities
12. Cash flows from financing activities
13. Net increase or decrease in cash during the period

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Accounting Basics: What is the direct and indirect methods
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