When Using the Indirect Method to Complete the Cash Flows

question 113

Multiple Choice

When using the indirect method to complete the cash flows from operating activities section,what is the proper treatment for an increase in the inventory account?

• A) Deduct the increase to cash payments to suppliers
• B) Add the increase to net income
• C) Add the increase to cash collections from customers
• D) Deduct the increase from net income

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Definitions:

Developmental Research Designs

Research methods used to examine changes in behavior or abilities over time, typically used in psychological and educational studies.

Panel Study

A type of longitudinal study where data are collected from the same subjects at multiple points in time, useful for identifying trends and changes.

Interrupted Time Series Design

Interrupted time series design is a research method that examines the effects of an intervention by analyzing observations before and after the intervention in a time series.

Mandatory Helmet Law

Legislation requiring the wearing of helmets in certain activities or contexts, often to enhance safety.