In Preparing a Statement of Cash Flows, Cash Flows from Operating

question 31

Multiple Choice

In preparing a statement of cash flows, cash flows from operating activities

• A) are always equal to accrual accounting income.
• B) are calculated as the difference between revenues and expenses.
• C) can be calculated by appropriately adding to or deducting from net income those items in the income statement that do not affect cash.
• D) can be calculated by appropriately adding to or deducting from net income those items in the income statement that do affect cash.

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Definitions:

Inferior Vena Cava

Vein that delivers oxygen-poor blood from the lower body to the heart.

Three-Chambered Heart

A type of heart structure found in some amphibians and reptiles, consisting of two atria and one ventricle, allowing for a degree of separation between oxygenated and deoxygenated blood.

Amphibian

Tetrapod with scaleless skin; it typically develops in water, then lives on land as a carnivore with lungs. For example, a frog or salamander.

Organism

An individual that consists of one or more cells.