If a Company Uses the Indirect Method to Prepare the Statement

question 165

Multiple Choice

If a company uses the indirect method to prepare the statement of cash flows, which of the following items would be added to net income in determining the net cash flow from operating activities?

• A)An increase in inventory would be added to net income.
• B)A decrease in accounts receivable would be added to net income.
• C)A decrease in accounts payable would be added to net income.
• D)An increase in preferred dividends payable would be added to net income.

---

Definitions:

Rank

A position within a hierarchy that indicates relative status or authority within a group, organization, or social structure.

Doing Gender

The concept that gender is not a fixed identity but rather an ongoing activity or performance that people engage in through their daily actions and interactions according to societal norms.

Practical Accomplishment

The successful completion of tasks or objectives through practical skills and actions.

Alienating System

A social or economic system that causes individuals to feel isolated, powerless, or disconnected from others and their environment.