In Calculating Cash Flows from Operating Activities Using the Indirect

question 4

Multiple Choice

In calculating cash flows from operating activities using the indirect method a gain on the sale of equipment is

• A) added to net income.
• B) deducted from net income.
• C) ignored because it does not affect cash.
• D) not reported on a statement of cash flows.

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Definitions:

Depressed

A state characterized by feelings of severe despondency and dejection, often accompanied by a lack of energy and difficulty in maintaining concentration or interest in life.

Attention

The cognitive process of selectively concentrating on one aspect of the environment while ignoring other things.

Promise

A declaration or assurance that one will do something or that a particular thing will happen.

Obsessive-compulsive Disorder

A mental disorder characterized by recurring unwanted thoughts (obsessions) and repetitive behaviors (compulsions) that the individual feels compelled to perform.