9 Which of the following statements is/are correct? (1) A statement of cash flow

Question

9 Which of the following statements is/are correct? (1) A statement of cash flows prepared using the direct method produces a different figure to net cash from operating activities from that produced if the indirect method is used (2) Rights issues of shares do not feature in a statement of cash flows (3) A surplus on revaluation of a non-current asset will not appear as an item in a statement of cash flows (4) A profit on the sale of a non-current asset will appear as an item under cash flows from investing activities in the statement of cash flows A 1 and 3 only B 3 and 4 only C 2 and 4 only D 3 only

Explanation / Answer

Answer: Option - D -  A surplus on revaluation of a non-current asset will not appear as an item in a statement of cash flows

explanation: It does not result in any cash inflow or outflow. It is result of just an adjustment in value of assets in the books without involving in any actual cashflow.

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