A Company with Substantial Operating Profits Prepares Its Statement of Cash

question 18

Multiple Choice

A company with substantial operating profits prepares its statement of cash flows using the indirect method.The gain on the sale of a long-term investment should be disclosed separately as a(n)

• A) inflow from operating activities.
• B) adjustment to net income in the reconciliation of net income to cash from operating activities.
• C) inflow from investing activities.
• D) outflow from investing activities.

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Definitions:

Empathic Parents

Caregivers who possess the ability to understand and share the feelings of their child, fostering a supportive and understanding family environment.

Erikson's Developmental Crisis

A concept identifying critical stages in human development, each presenting a distinct challenge or conflict that individuals must resolve to progress healthily.

Middle Childhood

A developmental stage that typically covers the period from around 6 to 12 years of age, characterized by significant growth in cognitive, emotional, and social domains.

Industry Versus Inferiority

Erikson’s fourth stage of psychosocial development, in which children must learn the productive skills their culture requires or else face feelings of inferiority.