A Company Uses the Indirect Method to Prepare the Statement

question 117

Multiple Choice

A company uses the indirect method to prepare the statement of cash flows, how will a gain from the sale of equipment be presented on the statement?

• A)A gain from the sale of equipment will be added to net income in the operating activities section.
• B)A gain from the sale of equipment will be an addition in the financing activities section.
• C)A gain from the sale of equipment will be deducted from net income in the operating activities section.
• D)A gain from the sale of equipment will be an addition in the investing activities section.

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Definitions:

Signal Relations

The association between different signals and what they represent, particularly in the context of communication systems or psychological conditioning.

Response-outcome Relations

The association between actions and the subsequent results, which plays a critical role in behavioral conditioning.

Observational Learning

The process of acquiring new behaviors, skills, or attitudes by watching and imitating the actions of others.

Conditioned Response

A response developed from conditioning, where a formerly neutral stimulus is now associated with an unconditioned stimulus, eliciting a learned reaction.