Which method calculates operating cash flows by adjusting the income statement on a line-by-line basis? a. Indirect method b. Direct method c. Discounted cash flow method d. Income method e. None of these.

B. Direct Method

Explanation:

Cash flow is the increase or decrease in the amount of money a business, institution, or individual has. In business, the term is used to describe the amount of cash (currency) that is generated or consumed in a given period of time.

When using the direct method, you list cash flows in the operations section of the cash flow statements. Cash flow due to operations arise from customer collection and cash paid to suppliers, employees and others.

B) Direct Method