When Using the Indirect Method to Complete the Cash Flows

question 75

Multiple Choice

When using the indirect method to complete the cash flows from operating activities section of the statement of cash flows, what is the proper disposition of depreciation expense?

• A)Subtract depreciationexpense from net income.
• B)Add depreciationexpense to net income.
• C)Disregard depreciationexpense because it relates to an investing activity.
• D)Disregard depreciationexpense because it is a noncash expense.

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