When a Company Uses the Direct Method to Determine the Net

Multiple Choice

When a company uses the direct method to determine the net cash flows from operating activities, cash flows from operating activities will:

A) be identical to the amount reported using the indirect method.
B) be larger if there is a net cash inflow and smaller if there is a net cash outflow compared to the amount reported using the indirect method.
C) always be larger than the amount reported using the indirect method.
D) be larger if there is a net cash outflow and smaller if there is a net cash inflow co mpared to the amount reported using the indirect method.