A Company Uses the Indirect Method to Prepare the Statement

question 173

Multiple Choice

A company uses the indirect method to prepare the statement of cash flows. It presents the following data on its financial statements: *Relates solely to the acquisition of inventory
What will appear in the operating activities section related to inventory?

• A)The decrease of $20,000 will be subtracted from net income.
• B)The decrease of $20,000 will be subtracted from cost of goods sold.
• C)The decrease of $20,000 will be added to net income.
• D)The decrease of $20,000 will be added to cost of goods sold.

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Definitions:

Personal Appearances

Events or occasions where an individual is physically present to represent themselves or an organization, often for promotional purposes.

PR Department

A division within an organization dedicated to managing its public image and communications with the media and other stakeholders.

Swim Apparel Firms

Companies that specialize in the design, production, and sale of clothing specifically for swimming and aquatic activities.

Volunteer Efforts

The work and services provided by individuals who freely offer their time and skills for the benefit of others or a cause without financial compensation.