When Preparing the Note Attached to the Statement of Cash

question 9

Multiple Choice

When preparing the note attached to the statement of cash flows reconciling operating profit with cash flow from operations, which statement is not true?

• A)An increase in current assets is deducted from profit.
• B)A decrease current assets is added to profit.
• C)An increase in current liabilities is deducted from profit.
• D)All of the above are true.

---

Definitions:

Cash Flow Verification

The process of auditing and validating the cash flows reported by a company to ensure accuracy and prevent fraud.

Capital Budgeting

The process of planning and managing a company’s long-term investments in projects or assets.

Technical Inputs

Elements related to the technological aspects of a project or system, including machinery, design parameters, and software requirements that contribute to its overall functionality and efficiency.

Time Value

The idea that money currently in hand is more valuable than an identical sum received later, because of its ability to earn more over time.