Assume That the Indirect Method Is Used to Determine Net

question 197

Multiple Choice

Assume that the indirect method is used to determine net cash provided by (used in) operating activities and that Accounts Receivable balance decreased by $10 million during the year.That $10 million should be:

• A)added to net income.
• B)subtracted from net income.
• C)added to investing activities.
• D)subtracted from investing activities.

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Definitions:

Cost of Goods Sold

The direct costs attributable to the production of goods sold by a company, including material and labor expenses.

Time Ticket

A document that indicates the employee, the hours worked, the account and job to be charged, and the total labor cost.

Personal Exemptions

Deductions allowed on individual income tax returns, reducing the amount of income subject to taxation, based on the taxpayer and dependents.

Job Number

An unique identifier assigned to a specific job or project for tracking costs, progress, and billing.