Company E
the Following Items Were Obtained from Company E's

question 80

Multiple Choice

Company E
The following items were obtained from Company E's financial records:
$\begin{array}{llr} \text { Accounts receivable, December 31 , Year 2 } &\$100,000\\ \text { Accounts receivable, December 31, Year 1 } &144,000\\ \text { Sales for Year 2} &945,000\end{array}$

-Refer to the figure Company E.Under the indirect method,how would the change in accounts receivable be reported in the operating activities section of Company E's statement of cash flows?

• A) as an addition to sales
• B) as a deduction from sales
• C) as an addition to net income
• D) as a deduction from net income

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Definitions:

Federal Spending

The total amount of money spent by the national government on various programs, services, and initiatives.

Borrowing

The act of obtaining funds from another party with the promise to repay the principal amount along with interest or dividends.

Economic Growth

An increase in the production of goods and services in an economy over a period, often measured as the percent rate of increase in real GDP.

OECD

An international organization (Organisation for Economic Co-operation and Development) that promotes policies to improve the economic and social well-being of people around the world.