If a Company Uses the Indirect Method to Prepare the Statement

question 144

Multiple Choice

If a company uses the indirect method to prepare the statement of cash flows, how will a loss from the sale of equipment be presented on the statement of cash flows?

• A)A loss from the sale of equipment will be added to net income in the operating activities section in the statement of cash flows.
• B)A loss from the sale of equipment will be an addition in the financing activities section in the statement of cash flows.
• C)A loss from the sale of equipment will be deducted from net income in the operating activities section in the statement of cash flows.
• D)A loss from the sale of equipment will be an addition in the investing activities section in the statement of cash flows.

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