Question

What adjustments are made to net income to arrive at operating cash flows in the operating section of the statement of cash flows

Answer 1

Adjustments of Non-Cash items and Changes in Working Capital items

Step-by-step explanation:

Cashflow Statement shows the movement in Cash and Cash equivalent balance during the reporting period. Net Income is not a Cashflow item, however this can be reconciled to Cashflow amount by adjusting it by Non-Cash items and Changes in Working Capital items. This is done when the Cashflow statement is prepared using the Indirect Method.