Which of the Following Actions Can Be Considered a Source

question 63

Multiple Choice

Which of the following actions can be considered a source of cash when constructing a statement of cash flows?

• A)Decrease in equity
• B)Decrease in accounts payable
• C)Increase in inventory
• D)Increase in long-term bonds
• E)Increase in fixed assets

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Definitions:

Responsibility Reporting

An accounting system that collects, summarizes, and reports financial information about different responsibility centers within an organization.

Investment Centers

Divisions or units within a company for which the manager has responsibility over costs, revenues, and investments.

Return on Investment

A measure used to evaluate the efficiency or profitability of an investment, calculated by dividing net profit by the cost of the investment.

Service Revenue

Income earned by a company for the services it provides, rather than for selling physical goods.