Module 23.2 The Direct and Indirect Methods Flashcards Preview

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Flashcards in Module 23.2 The Direct and Indirect Methods Deck (3)
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1
Q

Do you exclude depreciation from the direct method for CFOA?

A

Yes, it is a non cash expense

2
Q

How do you calculate CFIA under the direct and indirect method?

A

examining the gross asset accounts that result from investment activities scuh as PP&E, intangible assets, and investment securities.

3
Q

how do you calculate CFFA under the direct and indirect method?

A

net cash from creditors = new borrowings - principal amounts repaid
(+)
net cash flows from shareholders = new equity issued - share repurchases - cash dividends paid

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