Which of the Following Is Reported as an Operating Activity

question 187

Multiple Choice

Which of the following is reported as an operating activity on a cash flow statement prepared using the indirect method?

• A)Cash received from the sale of land
• B)Proceeds from the sales of investments
• C)Dividends paid to stockholders
• D)Increases in Accounts Payable

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Definitions:

ABC Implementation

The process of introducing Activity-Based Costing into an organization to allocate costs more accurately to products, services, and customers.

Activity Overhead Rates

Rates used to allocate overhead costs to products or services based on specific activities driving the overhead expenses.

Cost Pools

Groupings of individual costs based on their shared function or similarity, used in the allocation of costs to products or services.

ABC Systems

Activity-Based Costing systems, which allocate overhead costs based on the activities that drive those costs, providing more accurate cost information.