Cash Flows from Operating Activities-Indirect Method

question 79

Short Answer

Cash flows from operating activities-indirect method
In the computation of net cash flows from operating activities for 2015 by the indirect method,determine whether each of the following items would be added to net income,deducted from net income,or omitted from the computation.Indicate your answer by using the following symbols: + (added to net income),- (deducted from net income),or 0 (omitted from computation).
____ (a)A decrease in accounts payable to suppliers of merchandise during 2015.
____ (b)A loss recognized on the sale of office equipment during 2015.
____ (c)Depreciation expense for 2015.
____ (d)Dividends,declared at the end of last year,paid to shareholders during the current year.
____ (e)An increase in inventory levels during 2015.
____ (f)A decrease in accounts receivable from customers during 2015.

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Definitions:

Treasury Shares

Previously outstanding shares repurchased by a corporation that are not canceled or restored to unissued status.

Repurchased Shares

Stocks that have been bought back by the issuing company from shareholders, reducing the amount of outstanding shares on the market.

Outstanding Shares

A corporation’s shares currently held by shareholders.

Articles of Incorporation

A paper submitted to the state authorities to formally set up a corporation.