A Company Uses the Indirect Method to Prepare the Statement

question 86

Multiple Choice

A company uses the indirect method to prepare the statement of cash flows.Which of the following items would be added to net income in determining the net cash flow from operating activities?

• A)An increase in accrued liabilities would be added to net income.
• B)An increase in dividends paid would be added to net income.
• C)A decrease in accounts payable would be added to net income.
• D)A gain on the sale of land would be added to net income.

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Definitions:

Public Benefit

A positive impact or contribution to the wellbeing of the general public or community at large.

Materially Affected

A condition in which a party's rights, duties, or interests are significantly influenced or altered, typically in a legal or financial context.

Bylaws

The rules and regulations enacted by an organization or community to provide a framework for its operations and management.

Secretary of State

A senior government official responsible for keeping official records and executing certain duties, varying by country or state, often involving foreign affairs or administrative tasks.