Texas Corp The Change in Accounts Payable Is Reported as a Negative

question 100

True/False

Texas Corp. uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance sheet:
$\begin{array}{c}\text { Texas Corp.}\\\text { Comparative Balance Sheet}\\\text { December 31,2018and 2017}\\\begin{array}{|l|r|r|r|}\hline& 2018 & 2017 & \text { Increase/(Decrease) } \\\hline\text { Accounts Payable } & \$ 8,000 & \$ 9,000 & \$(1,000 )\\\hline \text { Accrued Liabilities } & 3,000 & 1,500 & 1,500 \\\hline \text { Long-term Notes Payable } & 56,000 & \underline{60,000} & \underline{(4,000)} \\\hline \text { Total Liabilities } & \$ 67,000 & \$ 70,500 & \$(3,500) \\\hline\end{array}\end{array}$ The change in Accounts Payable is reported as a negative cash flow in the adjustments to net income.

---

Definitions:

Psychological Processes

Internal mechanisms and operations of the mind that underlie functions such as thought, emotion, and behavior, shaping human experience and actions.

Mind

The set of cognitive faculties that enables consciousness, perception, thinking, judgement, and memory.

Natural Selection

The process whereby organisms better adapted to their environment tend to survive and produce more offspring.

Biologists

Scientists who study living organisms and their relationship to the environment, including their structure, function, growth, and evolution.