Accounting · Cash Flow Statement
Analyse the following statements regarding the Cash Flow Statement under the indirect method and choose the correct option: Statement 1: Depreciation is added back while computing cash flow from operating activities. Statement 2: An increase in trade receivables is added while calculating operating cash flow.
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Neither statement is correct
- 2Both statements are correct
- 3Only Statement 2 is correct
- 4Only Statement 1 is correct✓
Correct answer
Only Statement 1 is correct
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