| A | B |
|---|
| Cash Flow on Total Assets | Ratio of operating cash flows to average total assets; not affected by income recognition and measurement; reflects earnings quality. (p. 549) |
| Direct Method | Presentation of net cash from operating activities that lists major operating cash receipts less major operating cash payments. (p. 531) |
| Financing Activities | Transactions with owners and creditors that include obtaining cash from issuing debt, repaying amounts borrowed, and obtaining cash from or distributing cash to owners. (p. 526) |
| Indirect Method | Presentation that reports net income and then adjusts it by adding and subtracting items to yield net cash from operating activities. (p. 531) |
| Investing Activities | Transactions that involve purchasing and selling of long-term assets, including making and collecting notes receivable and investments in other than cash equivalents. (p. 526) |
| Operating Activities | Activities that involve the production or purchaseof merchandise and the sale of goods or services to customers, including expenditures related to administering the business. (p. 525) |
| Statement of Cash Flows | Financial statement that reports cash inflows and cash outflows for an accounting period and classifies them as operating, investing, or financing activities. (p. 524) |
