When Preparing the Operating Activities Section of the Statement of Cash

question 135

True/False

When preparing the operating activities section of the statement of cash flows using the indirect method,depreciation is added back to net income.

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Definitions:

Future Economic Benefit

The potential to contribute directly or indirectly to the flow of cash and cash equivalents to an entity.

Common Characteristic

A property or attribute that is shared among all members of a category.

Asset

An economic resource owned or controlled by an individual or corporation, expected to provide future benefit.

Basic Assumption

Basic Assumption is a foundational principle that underlies or is assumed to be the basis of reasoning, actions, decisions, or theories.