Which of the Following Statements Is Incorrect Regarding the Use

question 69

Multiple Choice

Which of the following statements is incorrect regarding the use of the indirect method when preparing the operating activities of the statement of cash flows?

• A) A decrease in accounts payableAccounts Payable is deducted from net income
• B) A decrease in prepaid insurancePrepaid Insurance is added to net income
• C) Gain on the retirement of bonds is deducted from net income
• D) Depreciation expense is subtracted from net income

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Definitions:

Lone Pair Electrons

Pairs of valence electrons on an atom that are not shared with another atom and are not involved in bonding.

Folic Acid

A B-vitamin essential for the body, playing a vital role in DNA synthesis and repair as well as red blood cell formation.

Folic Acid

A water-soluble B-vitamin (B9) important for cell growth and metabolism, often taken before and during pregnancy to prevent birth defects.

Antibiotics

Medicines used to prevent and treat bacterial infections by either killing bacteria or inhibiting their growth.