In Determining Net Cash Flow from Operating Activities, a Decrease

question 84

Multiple Choice

In determining net cash flow from operating activities, a decrease in accounts payable during a period

• A) means that income on an accrual basis is less than income on a cash basis.
• B) requires an addition adjustment to net income under the indirect method.
• C) requires an increase adjustment to cost of goods sold under the direct method.
• D) requires a decrease adjustment to cost of goods sold under the direct method.

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Definitions:

Consumer Product Category

Consumer product category refers to a classification of similar products or services offered to consumers that serve a similar purpose or satisfy a specific consumer need.

Distribution

The process of making a product or service available for the consumer or business user that needs it, including transportation, warehousing, and delivery.

Logistics

Refers to the detailed coordination and implementation of complex operations involving the supply chain, from procurement to distribution.

Supply Chain Management

The management of the flow of goods and services, involving the movement and storage of raw materials, work-in-process inventory, and finished goods from point of origin to point of consumption.