[المحاسب المتميز]

For cash flow statement, why the direct method and indirect method would agree?


E.G.
A company buys some equipment and will pay later (i.e. Equipment increases, Account Payable increases)

In this transaction, CFO does not change according to Direct Method.

However, CFO actually increases under Indirect Method (since Account Payable increases)


So....why would these 2 methods always agree?

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