Assume the Indirect Method Is Used to Compute Net Cash

question 17

Multiple Choice

Assume the indirect method is used to compute net cash flows from operating activities.For this item extracted from the financial statements-Decrease in Income Taxes Payable-indicate the effect on net income in arriving at net cash flows from operating activities by choosing one of the following:

• A)Add to net income to arrive at net cash flows from operating activities.
• B)Subtract from net income to arrive at net cash flows from operating activities.
• C)Not used to adjust net income to calculate net cash flows from operating activities.

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Definitions:

Margin of error

The amount of error that can be tolerated in survey or poll results, often used in describing the accuracy of a confidence interval.

Electric usage

The amount of electrical energy consumed by a device, household, or establishment over a given time period.

Edmund Charles Genet

Edmund Charles Genet was a French envoy to the United States in the 1790s, whose actions, including the unauthorized recruitment of American mercenaries to attack British ships, led to the Genet Affair, testing U.S. neutrality.