A Company Uses the Indirect Method to Prepare the Statement

question 125

Multiple Choice

A company uses the indirect method to prepare the statement of cash flows. How would a gain from the sale of equipment be presented on the statement?

• A)A gain from the sale of equipment would be an addition in the investing activities section.
• B)A gain from the sale of equipment would be added to net income in the operating activities section.
• C)A gain from the sale of equipment would be a deduction in the financing activities section.
• D)A gain from the sale of equipment would be deducted from net income in the operating activities section.

Comprehend consumer rights and liabilities under the Electronic Funds Transfer Act (EFTA).

Grasp the concepts of final payment, dishonor of checks, and the effects on the parties involved.

Recognize the warranties and duties of collecting banks in the check collection process.

Understand the application of stop payment orders and their validity period.

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Definitions:

Default Judgment

Judgment for the plaintiff that occurs when the defendant fails to respond to the complaint.

Plaintiff

The party who initiates a lawsuit seeking legal remedy from the court for some harm or injury suffered.

Defendant

A person, company, or institution sued or accused in a court of law.

Complaint

A formal expression of dissatisfaction or allegation of wrongdoing in a legal or professional context.