Practice
Check your answer
Write your response and explain your reasoning.
Prepare a direct operating section from supplied bank rows and receivable, payable, payroll, interest, and tax rollforwards. Show each exclusion and the resulting operating subtotal. State why the class names are cash claims rather than relabeled income-statement captions.
Compare your reasoning with the worked answer
Sum the supplied gross operating receipts and subtract the supplied gross operating payments. Reconcile each class to its bank rows and account rollforward; do not use revenue, expense, tax expense, or interest expense as cash proxies.