When Using the Indirect Method to Complete the Cash Flows

question 36

Multiple Choice

When using the indirect method to complete the cash flows from operating activities section,what is the proper treatment for an increase in the accounts receivable balance?

• A) Add the increase to net income
• B) Add the increase to cash collections from customers
• C) Deduct the increase from net income
• D) Add the increase to cash payments to suppliers

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Definitions:

Sympathetic

Relating to the sympathetic nervous system, which triggers the body's rapid involuntary response to dangerous or stressful situations; also means showing understanding or compassion toward others.

Alarm Phase

The initial phase of the stress response, where the body undergoes various physiological changes to combat stress.

Stress Response

The body's reaction to any change that requires an adjustment or response, involving physical, emotional, or cognitive components.

Magnetic Resonance Imaging

A diagnostic imaging technique used to create detailed images of the organs and tissues in the body using magnetic fields and radio waves.