When Preparing a Statement of Cash Flows on the Indirect

question 99

Multiple Choice

When preparing a statement of cash flows on the indirect method, which of the following is correct?

• A) Proceeds from the sale of equipment should be added to income in the operating activities section.
• B) A loss on the sale of land should be added to income in the operating activities section.
• C) The declaration of a cash dividend should be a use of cash in the financing activities section.
• D) The issuance of a bonus issue or share dividend should be a use of cash in the financing activities section.
• E) The purchase of land and a building by issuing a long-term note payable should be a source of cash in the financing activities section.

---

Definitions:

Genetically Female Fetus

A fetus that has two X chromosomes, determining female sex characteristics and reproductive anatomy development.

Testosterone

A steroid hormone that plays a key role in the development of male reproductive tissues as well as promoting secondary sexual characteristics such as increased muscle and bone mass, and the growth of body hair.

Intersexed Individuals

Persons born with reproductive or sexual anatomy that doesn’t fit typical definitions of male or female.

Surgery

A medical specialty involving manual and operative procedures to treat diseases, injuries, or deformities.