On a Statement of Cash Flows Using the Indirect Method

question 38

Multiple Choice

On a statement of cash flows using the indirect method, depreciation expense will

• A)be added to profit in the operating activities section.
• B)be deducted from profit in the operating activities section.
• C)appear as an inflow of cash in the investing activities section.
• D)be ignored.

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Definitions:

Loan Papers

Documents associated with a loan, including the agreement, terms and conditions, and any collateral-related paperwork.

Certificates Of Deposit

A type of federally insured savings account that has a fixed interest rate and fixed date of withdrawal, known as the maturity date.

Compounded Quarterly

The process of calculating interest on both the initial principal and the accrued interest over four quarters in a year.

Semi-annually

Occurring twice a year, typically used in the context of payments, compounding, or reporting periods.