In Accounting, What Is Direct Method?

Accounting method
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In Accounting, What Is Direct Method?

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In accounting, the direct method is a way to present cash flow statements, showing how cash was received and used in the business as of a certain period of time. It is a standardized report, presenting information on cash not available in other types of financial reports. This statement is important for bankers and investors, and anyone interested in cash applications of a business. Cash flow statements in the US can be prepared using the direct method or the indirect method.

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