The Following Items Were Reported on the Balance Sheets and Income

question 4

Multiple Choice

The following items were reported on the balance sheets and income statement for Collin Inc.: How would the change in accounts receivable be reported in the operating activities section of the statement of cash flows using the indirect method?

• A) as an addition to sales
• B) as a deduction from sales
• C) as an addition to net income
• D) as a deduction from net income

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Definitions:

Type II Error

A statistical error that occurs when a false null hypothesis is not rejected.

Alternative Hypothesis

A statement in hypothesis testing that proposes a relationship between variables or indicates a statistically significant effect, contrasting with the null hypothesis.

Null Hypothesis

A default position in statistical hypothesis testing that assumes no relationship or meaningful difference between certain observed phenomena.