Which of the Following Would Cause Net Income on the Accrual

question 68

Multiple Choice

Which of the following would cause net income on the accrual basis to be different from (either higher or lower than) "cash provided by operating activities" on the statement of cash flows?

• A)Purchased land for cash.
• B)Purchased supplies for cash.
• C)Paid advertising expense.
• D)Paid dividends to stockholders.

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Definitions:

Gross Method

An accounting method used to record purchases at the full invoice amount without deducting any cash discounts.

Defective Merchandise

Goods that are damaged or below quality standards, often leading to returns, exchanges, or adjustments in sales and accounting records.

Miscellaneous Accounts

Miscellaneous Accounts are ledger accounts that capture financial transactions not classified under specific account headings, often used for incidental or occasional transactions.

Voucher Register

A record containing details about payment vouchers, including the payee, amount, date, and purpose of each payment.