When Preparing a Statement of Cash Flows, a Decrease in Prepaid

question 55

Short Answer

When preparing a statement of cash flows, a decrease in prepaid insurance during a period would require which of the following adjustments in determining cash flows from operating activities?

---

Definitions:

Consumer Price Index

An index of the variation in prices paid by typical consumers for retail goods and other items.

GDP Deflator

A measure of the price level of all domestically produced goods and services in an economy, used to adjust nominal GDP to real GDP.

Gauge Of Inflation

A measure that reflects how much and how quickly prices for goods and services rise over a period, indicating the rate of inflation.

Basket Of Goods

A fixed set of consumer products and services valued on a regular basis for purposes of tracking inflation.