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:

Italian Prime Minister

The head of government in Italy, responsible for leading the country's executive branch and implementing national policies and laws.

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A short phrase or sentence that serves as a guiding principle or expresses the beliefs or ideals of an individual, family, or institution.

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A historic state in Central Europe, existing from 1871 to 1918, characterized by its imperial monarchy and rapid industrialization.

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