In Calculating Cash Flows from Operating Activities Using the Indirect

question 2

Multiple Choice

In calculating cash flows from operating activities using the indirect method, a gain on the sale of equipment is

• A) added to net income
• B) deducted from net income
• C) ignored because it does not affect cash
• D) reported supplementally as a noncash investing and financing activity

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Definitions:

Environment

The surrounding conditions or context in which a person, animal, or plant lives or operates.

Amplitude

The extent of a vibratory movement measured from the mean position to an extreme, commonly used in physics and signals to describe wave magnitudes.

Brightness

The perception of the intensity of light emitted or reflected by an object, affecting how we see colors and shapes.

Dilated

Refers to the widening or expansion of an opening, vessel, or organ beyond its normal size, often in response to some form of stimulus.