In Preparing a Statement of Cash Flows Using the Indirect

question 122

Multiple Choice

In preparing a statement of cash flows using the indirect method,a decrease in an unearned revenue account should

• A)be shown as a financing activity.
• B)be shown as a deduction from net income in computing net cash flows from operating activities.
• C)not be shown on the statement of cash flows.
• D)be shown as an addition to net income in computing net cash flows from operating activities.

---

Definitions:

Pastoral Societies

Communities whose primary means of subsistence is based on the rearing and breeding of livestock.

Subsistence Pattern

The means by which a society acquires its food resources, ranging from hunting and gathering to agriculture and industrial food production.

Hunting

The practice of tracking and killing wild animals for food, recreation, or trade, often regulated by laws to ensure sustainable populations.

Gathering Societies

Communities that primarily subsist on gathering, hunting, and fishing, rather than agricultural or animal husbandry practices.