In Order to Derive a Statement of Cash Flows, the Owner

question 5

Multiple Choice

In order to derive a statement of cash flows, the owner must add back the _____ to the statement of profit or loss and other comprehensive income.

• A)depreciation expense
• B)increase in trade receivables
• C)increases in inventory
• D)decrease in trade and other payables

---

Definitions:

Broad Principles

General, overarching rules or guidelines that inform or direct action in a wide range of situations.

Rules-Based

A system or approach that is guided by a set of established rules or standards.

IFRS

International Financial Reporting Standards, which are a set of accounting standards developed by the International Accounting Standards Board that guide the financial reporting of companies globally.

Rise

An increase in a metric or quantity, often used in financial contexts to indicate growth or upward movement in value.