Avatar Company Uses the Indirect Method to Prepare the Statement $\quad$

question 59

Multiple Choice

Avatar Company uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance sheet: $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ Avatar Company
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ Comparative Balance Sheet
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ December 31, 2014 and 2013
$\begin{array}{lrrr} & 2014 & 2013& \text { Increase/decrease } \\\text {Accounts Payable } & \$ 4,000 & \$ 6,000 & \$ (2,000) \\\text { Accrued Liabilities} & 2,000 & 1,000 & 1,000 \\\text { Long-Term Notes Payable } & 84,000 &90,000 & (6,000) \\ \text { Total liabilities} & \$90,000 &\$97,000 & \$(7,000) \\\hline\end{array}$ How will the change in Accrued Liabilities be shown on the statement of cash flows?

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Definitions:

Individual Litigation

Legal action taken by a single plaintiff or defendant in a court proceeding, rather than by or against a group or class.

Ethically Required

Actions or behaviors that are mandated or guided by ethical standards or principles.

Smelting Company

A business that specializes in extracting pure metal from ore through heating and melting processes.

Service Of Process

The delivery of the complaint and summons to a defendant.