A Company Uses the Indirect Method to Prepare the Statement

question 46

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 accounts payable?

• A)The increase of $8000 will be subtracted from net income.
• B)The increase of $8000 will be added to net income.
• C)The increase of $8000 will be subtracted from cost of goods sold.
• D)The increase of $8000 will be added to cost of goods sold.

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Definitions:

Expert Power

The influence one can exert over others due to special skills, knowledge, or expertise in a particular area.

Influence Tactics

Strategies or approaches used to persuade or direct others' behavior in order to achieve one's objectives.

Referent Power

A form of influence based on the ability to attract others and build loyalty through charisma, likability, or status.

Influence Tactics

Strategies or methods used by individuals to change the perception, opinion, or behavior of others to achieve a desired outcome.