Which of the Following Is the Correct Equation to Use

question 40

Multiple Choice

Which of the following is the correct equation to use when calculating cash payments for income taxes under the direct method?

• A)Net income - Decrease in income taxes payable or + Increase in income taxes payable
• B)Net income + Decrease in income taxes payable or - Increase in income taxes payable
• C)Income tax expense - Decrease in income taxes payable or + Increase in income taxes payable
• D)Income tax expense - Decrease in accounts receivable or + Increase in accounts receivable