Which of the following statements regarding Statement of Cash Flows is true? Multiple Choice The indirect method of preparation of the Statement of Cash Flows begins with Net Income, and then adds back the noncash items such as depreciation expense. Proceeds from sales of plant assets are shown in the investing activities section as a subtraction. In the direct method of preparation of Statement of Cash Flows, interest and dividends received are reflected in the Investing Activities section. The direct method and the indirect method differ in all three sections of the Statement of Cash Flows.