Which of the Following Changes Is Considered a Source of Cash

question 110

Multiple Choice

Which of the following changes is considered a source of cash when preparing a statement of cash flow?

• A)An increase in property, plant, and equipment
• B)A decrease in accounts payable
• C)A decrease in inventories
• D)An increase in accounts receivable
• E)A decrease in accrued wages

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Definitions:

Sales

The revenue a company generates from selling goods or services.

Consolidated Balance Sheet

A financial statement presenting the total assets, liabilities, and shareholders' equity of a parent company and its subsidiaries as one entity.

Patents

Exclusive rights granted to an inventor to manufacture, use, or sell an invention for a certain number of years.

Impairment Loss

A reduction in the recoverable value of a fixed asset or goodwill below its book value, leading to a write-down and charge against earnings.