A Company Uses the Indirect Method to Prepare the Statement

question 121

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 $18,000 will be subtracted from net income.
• B)The decrease of $18,000will be subtracted from cost of goods sold.
• C)The decrease of $18,000 will be added to net income.
• D)The decrease of $18,000 will be added to cost of goods sold.

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Definitions:

Cardiomyopathy

A disease of the heart muscle that makes it harder for the heart to pump blood to the rest of the body, potentially leading to heart failure.

Musculoskeletal

Pertaining to the system that encompasses muscles, bones, joints, tendons, and ligaments, facilitating movement and structural support.

Neurological

Related to the nervous system, encompassing the brain, spinal cord, and nerves, and the disorders that affect them.

Osteoarthritis

A condition where the cartilage and bone within a joint degrade over time, causing discomfort and limited mobility.