How is cash flow prepared using the indirect method?

How is cash flow prepared using the indirect method?

• A. Start with net income and adjust for non-cash items and changes in working capital to arrive at cash from operating activities.
• B. Start with gross profit and adjust for non-cash items.
• C. Start with cash from investing activities and adjust for changes in working capital.
• D. Begin with financing activities and back into operating activities.

Answer: (A)