In Creating a Statement of Cash Flows Using the Indirect

question 54

Multiple Choice

In creating a statement of cash flows using the indirect method, which of the following statements is TRUE about depreciation expense?

• A) It is added back as an adjustment to net income in the operating activities section.
• B) It is shown as a negative cash flow in the investing activities section.
• C) It is added back to purchases of plant assets under investing activities.
• D) It is shown as a negative cash flow under operating activities.

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