Which of the Following Should Be Deducted from Net Income

question 25

Multiple Choice

Which of the following should be deducted from net income in calculating net cash flow from operating activities using the indirect method?

• A) A decrease in inventory
• B) A decrease in accounts payable
• C) Preferred dividends declared and paid
• D) A decrease in accounts receivable

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Definitions:

General Supplies

Items commonly used in various sectors such as office supplies, cleaning products, and basic operation materials.

Clinical Supplies

Items such as medical instruments, bandages, and medications used in a healthcare setting for patient care.

Purchasing Group

A group of individuals or entities that come together to buy goods or services collectively, often to obtain better terms or pricing.

Medical Practices

The professional activities and procedures performed by healthcare providers to diagnose, treat, and prevent illness or maintain health.