A Company Uses the Direct Method to Prepare the Statement

question 118

Multiple Choice

A company uses the direct method to prepare the statement of cash flows. It presents the following amounts on its financial statements. *Relates solely to the acquisition of inventory
What will appear in the operating activities section related to salary payable?

• A)The increase of $4,000 will be subtracted from salary expense to determine payments to employees.
• B)The increase of $4,000 will be subtracted from net income.
• C)The increase of $4,000 will be added to salary expense to determine payments to employees.
• D)The increase of $4,000 will be added to net income.

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Definitions:

Esotropia

A condition where one or both eyes turn inward, often referred to as "crossed eyes."

Accommodation

The ability of the eye to change its focus from distant to near objects, involving the adjustment of the lens shape.

Phacolysis

The surgical dissolution or fragmentation of the lens of the eye, usually to treat cataracts.

Phacoemulsification

A surgical method used to remove cataracts from the eye through the use of ultrasonic energy to emulsify the lens.