Misconception · MIS:direct-and-indirect-cash-flows-are-added-together

Mistaken idea “Direct and indirect operating cash flows are added together”

Mistaken reasoning: This mistake treats two presentations of one operating subtotal as separate cash sources.

Updated Aug 21, 2026 Review due Nov 8, 2026

Why this is mistaken

The two methods must agree for the same scope. Agreement is a cross-check, not a second inflow.

Where to watch

When this mistake may appear

  • Both methods produced $2 million.
Check your work

Your work may contain this mistake if:

  • Reports $4 million of operating cash after adding the methods.