When Preparing the Statement of Cash Flows Under the Indirect

question 77

Multiple Choice

When preparing the statement of cash flows under the indirect method,all of the following would be an appropriate procedure except

• A)adding depreciation expense.
• B)subtracting a decrease in accounts payable.
• C)subtracting a decrease in prepaid expenses.
• D)adding a decrease in inventories.
• E)subtracting a gain from the sale of a fixed asset.

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Definitions:

Scanning the Situation

The process of carefully examining and assessing the current state or conditions of an environment or situation to identify key elements and challenges.

Forecasting

Forecasting involves making predictions about future events or trends based on current and historical data analysis.

Stakeholder Audit

An evaluation process that identifies and assesses the interests and influences of individuals or groups that have a stake in the outcomes of a project or company.

Evaluating Alternatives

The process of critically examining different options or courses of action to determine their potential effectiveness in achieving a desired outcome.