On the Statement of Cash Flows Prepared Using the Indirect

question 158

Multiple Choice

On the statement of cash flows prepared using the indirect method, a $7,500 gain on the sale of fixed assets would be

• A) added to net income in converting the net income reported on the income statement to cash flows from operating activities
• B) deducted from net income in converting the net income reported on the income statement to cash flows from operating activities
• C) added to dividends declared in converting the dividends declared to the cash flows from financing activities related to dividends
• D) deducted from dividends declared in converting the dividends declared to the cash flows from financing activities related to dividends

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Definitions:

Budget Cuts

The reduction in spending and allocation of funds within an organization, government, or institution, often leading to changes in services or operations.

Korean War

A conflict between North Korea, assisted by China and the Soviet Union, and South Korea, supported by the United Nations primarily led by the United States, from 1950 to 1953, which ended in an armistice.

Civil Rights Legislation

Laws and regulations enacted to protect and guarantee the basic rights and freedoms of individuals, especially regarding equality and justice.

Joseph McCarthy

A U.S. senator known for his anti-communist sentiments and the subsequent fear and political repression he inspired during the early 1950s, a period often referred to as McCarthyism.