In a Statement of Cash Flows Using the Indirect Method

question 11

Multiple Choice

In a statement of cash flows using the indirect method, an increase in available-for-sale securities not due to an increase in their fair value should be reported as:

• A)A deduction from net income in determining cash flows from operating activities.
• B)An addition to net income in determining cash flows from operating activities.
• C)A net cash outflow from investing activity.
• D)A net cash inflow from investing activity.The increase would indicate an investment in the securities.