On the Statement of Cash Flows, a $7,500 Gain on the Sale

question 128

Multiple Choice

On the statement of cash flows, a $7,500 gain on the sale of fixed assets would be

• A) added to net income in converting the net income reported on the income statement to cash flows from operating activities
• B) deducted from net income in converting the net income reported on the income statement to cash flows from operating activities
• C) added to dividends declared in converting the dividends declared to the cash flows from financing activities related to dividends
• D) deducted from dividends declared in converting the dividends declared to the cash flows from financing activities related to dividends

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Definitions:

Perception

The process by which individuals organize and interpret their sensory impressions to give meaning to their environment.

Sensory Impulses

Electrical signals that are generated by sensory receptors in response to a stimulus, and then transmitted to the brain for interpretation.

Mental Operations

Cognitive processes that involve manipulating information mentally, such as reasoning, problem-solving, and decision-making.

Electrical Impulses

Rapid signals transmitted along neurons, facilitating communication within the brain and between the brain and the rest of the body.