Question

Which of the following will not affect cash flows under

Q: Answer-Which of the following will not affect cash flows under indirect method when reconciling profit to n...

A revaluation surplus is a non-cash item recognized directly in equity through OCI and does not involve cash flows. It is not added back in the operating cash flow reconciliation under the indirect method.

indirect method when reconciling profit to net cash from operating activities?

A Depreciation (non-cash)

B Increase in trade receivables (adjustment for working capital)

C Loss on sale of fixed assets (add back)

D Revaluation surplus (OCI item) --- typically non-cash and no effect on operating cash flows unless realised

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Which of the following will not affect cash flows under

Solution