Which of the Following Would Be Reported on the Statement

question 171

Multiple Choice

Which of the following would be reported on the statement of cash flows,using the direct method,as a cash flow from operating activities?

• A)Payment of income taxes.
• B)Payment of cash dividends.
• C)Purchase of a building.
• D)Purchase of treasury stock.

---

Definitions:

Sales Level

The quantity of goods or services sold or the amount of revenue generated from sales over a specific period.

Income Change

A variation in the amount of earnings generated by a business due to operations or other business activities over a specific period.

Absorption Costing

A method of costing that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed manufacturing overhead - in the cost of a product.

Variable Costing

An accounting method that includes only variable production costs (direct materials, direct labor, and variable manufacturing overhead) in product costs, excluding fixed overhead from inventory valuation.