On a Statement of Cash Flows Prepared Using the Direct

question 5

Multiple Choice

On a statement of cash flows prepared using the direct method,cash from customers would be sales plus a(n)

• A) decrease in accounts payable.
• B) increase in accounts payable.
• C) decrease in accounts receivable.
• D) increase in accounts receivable.

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Definitions:

Winding Up

The process of dissolving a company by selling its assets, paying off creditors, and distributing the remaining assets to shareholders.

Liquidation

The process of closing a business and distributing its assets to claimants.

Capital Contribution

The cash, property, or other assets that investors or owners provide to a business in exchange for an ownership interest or equity.

RULPA

The Revised Uniform Limited Partnership Act, designed to update and standardize the law governing limited partnerships across the states.