On a Statement of Cash Flows(indirect Method),which Line Item Is

question 19

Multiple Choice

On a statement of cash flows(indirect method) ,which line item is NOT reported as an operating activity?

• A)Depreciation expense
• B)Net income
• C)Increase in inventory
• D)Repayment of long-term debt

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Definitions:

NPV

Net Present Value, a method for assessing the worth of a project or investment by applying a discount rate to future cash flows to ascertain their current value.

Crossover Rate

The rate at which two projects have the same net present value, used in capital budgeting to compare the attractiveness of different projects.

Mutually Exclusive

Mutually exclusive projects or events are those that cannot occur simultaneously; choosing one option means the other cannot be selected.

NPV

Net Present Value, a method used in capital budgeting to assess the profitability of an investment or project.