In Preparing the Statement of Cash Flows by the Indirect

question 59

Multiple Choice

In preparing the statement of cash flows by the indirect method,which of the following is an incorrect statement of one of the general rules to convert net income to a cash-basis equivalent?

• A) Increases in current assets are subtracted from net income.
• B) Noncash revenue and gains are subtracted from net income.
• C) Decreases in current assets are added to net income.
• D) Increases in current liabilities are subtracted from net income.

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Definitions:

Cranial Nerves

Twelve pairs of nerves that emerge directly from the brain, not the spinal cord, and control many functions including eye movement, facial sensations, and taste.

Pairs

Two items, individuals, or elements grouped together.

Neurogenesis

The process of generating new neurons in the brain, which can occur in certain brain regions throughout life.

Stem Cells

Undifferentiated cells capable of giving rise to indefinitely more cells of the same type, and from which certain other kinds of cell arise by differentiation.