Presented Below Is the Operating Activities Section of a Statement

question 65

Multiple Choice

Presented below is the operating activities section of a statement of cash flows for 2014: $\begin{array}{llr}\underline {\text { Operitima activities. }} \\\text {Net income }& & \$ 120,000 \\\text {Add: }&\text {Depreciation } &10,000 \\& \text { Decrease in accountsreceivable }& \underline {5,000} \\& &\$ 135,000 \\\text { Deduct: }& \text { Decrease in accounts payable }&\underline {15,000} \\& \text { Net cash inflow from operating activities }&\underline {\$ 120,000}\end{array}$ Which method of preparing the operating activities section was used?

• A)The direct method.
• B)The indirect method.
• C)Either method.
• D)Cannot be determined without further information.

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Definitions:

National Origin

National origin refers to the country where a person was born or where their ancestors originated, often used in discussions relating to demographics, identity, and legal issues surrounding immigration and citizenship.

Family and Medical Leave Act

A U.S. federal law that provides employees with unpaid, job-protected leave for certain family and medical reasons.

Unpaid Time Off

Time away from work, such as for personal reasons, health, or vacation, during which an employee does not receive salary or wages.

Serious Illness

A health condition that poses a significant risk to an individual's well-being, often requiring extensive medical care.