An Increase in Inventory Is Reported in a Statement of Cash

question 38

Multiple Choice

An increase in inventory is reported in a statement of cash flows using the indirect method as a(n)

• A)addition to net income in arriving at net cash flows from operating activities.
• B)deduction from net income in arriving at net cash flows from operating activities.
• C)cash outflow from investing activities.
• D)cash outflow from financing activities.

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Definitions:

Skewness

A measure of the asymmetry of the probability distribution of a real-valued random variable about its mean, indicating whether the distribution is stretched more to the left or to the right.

Normal Curve

A symmetrical, bell-shaped curve representing a normal distribution of data around the mean.

Population

A total set of individuals, items, or data from which a statistical sample is drawn.