Hubble Corporation, Which Uses the Indirect Method to Prepare Its

question 50

Multiple Choice

Hubble Corporation, which uses the indirect method to prepare its statement of cash flows, sold used equipment for cash. Which statement regarding this sale is TRUE?

• A)The cash from operating activities will be greater if the direct method is used to prepare the statement of cash flows.
• B)The effect on cash from operating activities depends on whether there was a gain or loss on sale.
• C)The cash from operating activities will be less if the direct, rather than indirect, method is used to prepare the statement of cash flows.
• D)The cash from operating activities will not be reported if the indirect method is used to prepare the statement of cash flows.

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Definitions:

Supreme Court

The highest judicial body in a country, typically having the ultimate authority in legal matters and the interpretation of the constitution.

John Marshall

The fourth Chief Justice of the United States (1801-1835) known for establishing the principles of United States constitutional law.

Roger Taney

A historical figure known for serving as the fifth Chief Justice of the United States Supreme Court, most notably for delivering the Dred Scott decision which declared African Americans could not be American citizens.

Anti Federalists

A group of individuals in the early United States who opposed the ratification of the Constitution, fearing it gave too much power to the national government.