Which of the Following Items Would $\textbf{ not }$

question 29

Multiple Choice

Which of the following items would $\textbf{ not }$ be included in the calculation of cash flows provided by operating activities using the indirect method?

• A)Purchasing supplies on account
• B)Net income
• C)Depreciation expense
• D)Gain on the sale of equipment

Identify and classify items that appear on income statements, balance sheets, and statements of owner's equity.

Explain the interrelationship among the income statement, statement of owner's equity, balance sheet, and statement of cash flows.

Calculate and interpret financial ratios to assess liquidity, solvency, and profitability.

Identify errors in financial statements and make appropriate adjustments.

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Definitions:

Paying

The process of distributing money in exchange for goods, services, or to settle debts.

Adjusting Entry

Journal entries made in accounting records at the end of an accounting period to allocate income and expenditures to the correct periods.

Seller

An individual or entity that offers goods or services in exchange for payment.

Financial Statement

Publications detailing a corporation's financial health, encapsulating the balance sheet, income statement, and cash flow statement.