The Following Items Were Reported on the Balance Sheets and Income

question 64

Multiple Choice

The following items were reported on the balance sheets and income statements of Marshall Company: How would the change in accounts payable be reported in the operating activities section of the statement of cash flows under the indirect method?

• A) as an addition to operating expenses
• B) as a deduction from operating expenses
• C) as an addition to net income
• D) as a deduction from net income

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Definitions:

Opportunity Cost

Yielding potential gains from different scenarios when one is favored.

Society

A group of individuals involved in persistent social interaction, or a large social group sharing the same geographical or social territory, typically subject to the same political authority and dominant cultural expectations.

Production Possibilities Curve

A graphical representation showing the maximum quantity of two goods or services that can be produced within a given time period and with available resources.

Efficiently

The ability to achieve a desired result or produce a desired output with the least amount of waste, effort, or inefficiency.