Under the Indirect Method of Preparing the Statement of Cash

question 101

Multiple Choice

Under the indirect method of preparing the statement of cash flows,a gain on the sale of equipment is:

• A)subtracted from net income in the operating activities section.
• B)added to net income in the operating activities section.
• C)subtracted from the book value of the equipment in the financing activities section.
• D)ignored since this transaction does not affect cash.

---

Definitions:

Beak Sizes

Variations in the length, width, and shape of the beaks of birds, often correlating with their feeding habits and ecological niches.

Indicator Species

Organisms used to assess the health of an ecosystem because their presence, absence, or abundance reflects a specific environmental condition.

Environmental Degradation

The deterioration of the environment through depletion of resources, destruction of ecosystems, and the extinction of wildlife.

Sensitive

Capable of detecting or responding to slight changes, signals, or influences.