Which of the Following Would Be an Addition to Net

question 50

Multiple Choice

Which of the following would be an addition to net income when using the indirect method to derive net cash flows from operating activities?

• A) Payment of cash dividends
• B) Decrease in accounts payable
• C) Increase in merchandise inventory
• D) Loss on sale of machinery and equipment

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Definitions:

Easement Appurtenant

A right for the benefit of one piece of land (dominant estate) that allows access or use of a neighboring land (servient estate).

New Owner

The individual or entity that acquires ownership or property rights in something, such as real estate or a company, often through purchase or transfer.

Land

The part of the earth's surface that is not covered by water, including any buildings, crops, or natural resources upon it, which can be owned or used.

Easement in Gross

A legal right to use another person's land for a specific, limited purpose, which is not tied to any particular piece of property.