What are the two different reporting formats for preparing the operating activities section of the statement of cash$$ flows? Explain.

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Part $1$

A$.$

There are two acceptable formats for the statement of cash flows$-$ the indirect method and the direct method. The only difference between the two formats is the method used to calculate cash flows from investing activities. Net cash flows from investing activities will be the same under either method.

B$.$

There are two acceptable formats for the statement of cash flows$-$ the indirect method and the direct method. The only difference between the two formats is the method used to calculate cash flows from operating activities. Net cash flows from operating activities will be the same under either method.

C$.$

There are two acceptable formats for the statement of cash flows$-$ the cash method and the accrual method. The only difference between the two formats is the method used to calculate cash flows from investing activities. Net cash flows from investing activities will be the same under either method.

D$.$

There are two acceptable formats for the statement of cash flows$-$ the cash method and the accrual method. The only difference between the two formats is the method used to calculate cash flows from operating activities. Net cash flows from operating activities will be the same under either method.