Which of the Following Statements Does Not Correctly Describe an Adjustment

question 107

Multiple Choice

Which of the following statements does not correctly describe an adjustment to net income when determining cash flows from operating activities when using the indirect method?

• A)An increase in accounts receivable will be deducted from net income.
• B)A loss on the sale of a depreciable asset will be added to net income.
• C)An increase in accrued liabilities will be deducted from net income.
• D)An increase in accounts payable will be added to net income.

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Definitions:

Forward Market

A financial market where contracts for future delivery of goods, assets, or financial instruments are bought and sold.

Foreign Exchange Risk

The potential for financial loss resulting from fluctuations in foreign exchange rates.

Professionals

Qualified individuals who possess specialized knowledge and skills in a specific field.

Eurobond

A bond denominated in a currency other than that of the country in which it is sold.