AC Heating & Cooling Uses the Indirect Method to Prepare

question 19

Multiple Choice

AC Heating & Cooling uses the indirect method to prepare the statement of cash flows.During 2X03,AC Heating & Cooling had $100,000 in net income,which included a gain of $10,000 from the sale of a plant asset.To calculate operating cash flows,AC Heating & Cooling must

• A)deduct $10,000 from net income in the operating activities section of the statement of cash flows.
• B)add $10,000 to net income in the operating activities section of the statement of cash flows.
• C)deduct $10,000 from net income in the investing section of the statement of the statement of cash flows.
• D)add $10,000 to net income in the investing section of the statement of cash flows.
• E)deduct $10,000 from net income in the financing section of the statement of cash flows.

---

Definitions:

Employers

Individuals or entities that hire and provide work to employees, offering payment for services or labor performed.

Lockout

An employment and negotiation strategy in which an employer prevents employees from working during a dispute, aiming to pressure the union into concessions.

Strike

A work stoppage initiated by employees as a form of protest, typically in an attempt to gain concessions from their employer regarding pay, conditions, or policies.

Union Membership

The status of being a member of a labor union, an organization that represents the collective interests of workers in negotiations with employers over wages, benefits, and working conditions.