Which of the Following Independent Transactions Would Cause Net Income

question 145

Multiple Choice

Which of the following independent transactions would cause net income to be more than cash from operating activities?

• A) A decrease in the accounts receivable account
• B) An increase in the merchandise inventory account
• C) An increase in the accounts payable account
• D) An increase in the accrued wages account

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Definitions:

Cause-and-Effect

An analysis that explores the reasons for a particular event or situation and the consequences that result from it.

Conventional Pattern

Established or widely recognized methods of organizing information or structuring documents that readers expect.

Cause-and-Effect

A relationship in which one event (the cause) makes another event happen (the effect), often used to explain the reason behind certain outcomes.

Causal Relationship

A connection between two events or states where one directly results in the other, implying causation.