When Preparing a Statement of Cash Flows (Indirect Method), Which

question 62

Multiple Choice

When preparing a statement of cash flows (indirect method) , which of the following is not an adjustment to reconcile net income to net cash provided by operating activities?

• A) A change in interest payable
• B) A change in dividends payable
• C) A change in income taxes payable
• D) All of these are adjustments.

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Definitions:

Accumulated Depreciation

The total depreciation that has been recorded for an asset since its acquisition, reflecting its reduction in value over time.

Budgeted Balance Sheet

A financial statement that projects the future financial position of a company, showing expected assets, liabilities, and equity.

Direct Labor Requirement

The total amount of work time needed by employees to produce a good or service, often used in budgeting and planning manufacturing processes.

Labor Rate

The cost associated with hiring labor, often expressed per hour or unit of work.