When Preparing the Operating Section of the Statement of Cash

question 107

True/False

When preparing the operating section of the statement of cash flows using the indirect method,an increase in income taxes payable is added back to net income.

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Definitions:

FUTA

The Federal Unemployment Tax Act institutes a payroll levy on companies to support state employment organizations.

SUTA

State Unemployment Tax Act; a payroll tax that employers pay to fund their state's unemployment insurance.

FICA-OASDI

The Federal Insurance Contributions Act, also known as Old Age, Survivors, and Disability Insurance, is a payroll tax which finances Social Security and Medicare programs within the United States.

SUTA

State Unemployment Tax Act, which requires employers to contribute to the state unemployment insurance program.