When Preparing a Statement of Cash Flows Using the Indirect

question 9

Essay

When preparing a statement of cash flows using the indirect method,why is depreciation added back to net income within the operating activities section?

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Definitions:

Regulatory Agency

An agency, commission, or board established by the federal government or a state government to control the prices charged and the services offered by a natural monopoly or public utility.

Rivalry

The characteristic displayed by certain goods and services that consumption by one person precludes consumption by others.

Buys

The act of acquiring goods or services in exchange for money.

Product

Any good, service, or idea that can be offered to a market to satisfy a want or need.