Which of the Following Is a Deduction from Net Income

question 3

Multiple Choice

Which of the following is a deduction from net income when using the indirect approach to prepare the cash from operating activities of the Statement of Cash Flows?

• A)increase in accounts payable
• B)increase in prepaid expenses
• C)loss on sale of investments
• D)depreciation expense

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Definitions:

Ionic Compounds

Compounds composed of ions held together by ionic bonds; typically formed when a metal reacts with a nonmetal or a polyatomic ion.

CH4

CH4, methane, is a simple alkane hydrocarbon with one carbon atom bonded to four hydrogen atoms, and is a major component of natural gas.

NH3

Ammonia, a colorless gas with a pungent smell, consisting of nitrogen and hydrogen (NH3).

Diatomic Elements

Molecules composed of only two atoms, of the same or different chemical elements.