When Preparing the Statement of Cash Flows Using the Indirect

question 7

Multiple Choice

When preparing the statement of cash flows using the indirect method, which of the following is added to net income to determine cash flows from operations?

• A) payments to suppliers
• B) receipts from customers
• C) bond premium amortization
• D) unrealized losses from trading securities

---

Definitions:

Insurer's Risks

The potential for financial loss that an insurance company agrees to cover under the terms of an insurance policy.

Insurance Broker

A professional intermediary who acts on behalf of clients to find and arrange appropriate insurance coverage from insurers.

Independent Contractor

is an individual who provides services to another entity under terms specified in a contract or agreement, without being legally considered an employee.

Liability Coverage

Insurance that provides protection against claims resulting from injuries and damage to people and/or property.