A Decrease in Deferred Taxes (Liability) Would Appear on the Statement

question 148

Multiple Choice

A decrease in deferred taxes (liability) would appear on the statement of cash flows, prepared using the indirect method as a(n)

• A) addition to net income in the operating activities category.
• B) deduction to net income in the operating activities category.
• C) inflow of cash in the financing activities category.
• D) outflow of cash in the financing activities category.

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Definitions:

Analytical Reports

Documents that provide detailed analysis and insights on specific subjects, often used to support decision-making processes.

Skeptical Audiences

Groups or individuals who are inclined to doubt or question the validity of information presented to them.

Indirect Approach

A communication strategy that involves conveying a message in a roundabout way, rather than stating it directly, often used to soften the impact.

Hypothesis

A proposed explanation made on the basis of limited evidence as a starting point for further investigation.