In a Company That Uses the Direct Method to Prepare

question 120

Multiple Choice

In a company that uses the direct method to prepare the statement of cash flows, the amount of cash it pays to employees is computed as

• A)salary expense plus the ending balance salaries payable.
• B)salary expense plus the decrease in salaries payable.
• C)salary expense plus the increase in salaries payable.
• D)salary expense plus the beginning balance in salaries payable.

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Definitions:

Mechanism

The detailed step-by-step description of how a chemical reaction occurs, including the breaking and formation of bonds.

Reaction

A process in which one or more substances (the reactants) are converted to one or more different substances (the products).

Terpene

A class of natural organic compounds, typically derived from plants, with a structure based on isoprene units.

Monocyclic

Pertains to chemical compounds that contain only one cyclic structure within their molecular framework.