accounting dicussion 3

Module 04: Discussion 02 - Indirect Method 1 1 unread reply. 1 1 reply.

Instructions

For the current year, Packers Company decided to switch from the indirect method to the direct method for reporting cash flows from operating activities on the statement of cash flows. Will the change cause the amount of net cash flow from operating activities to be larger, smaller, or the same as if the indirect method had been used? Explain.

What are the principal advantages and disadvantages of the direct method and the indirect method of cash flows? Explain.