Question :
66. Which of the following subtracted from net income in : 1370149
66. Which of the following is subtracted from net income in computing cash flows from operating activities using the indirect method?
A)increases in accounts receivable
B)decreases in accounts receivable
C)decrease in taxes payable
D)depreciation expense
67. If a firm sells for $8,000 equipment that cost $25,000 and has $20,000 of accumulated depreciation, how is this reported in the statement of cash flows?
A)$8,000 investing activity
B)$8,000 financing activity
C)$8,000 financing activity and $3,000 addition to net income
D)$8,000 investing activity and $3,000 subtraction from net income
68. Which of the following statements about the statement of cash flows is false?
A)The direct method provides more information than the indirect method
B)Firms can use either the direct method or the indirect method of reporting operating activities
C)Cash flows from operating activities is larger if the indirect method is used instead of the direct method
D)If firms use the direct method, they must also provide a reconciliation of net income and operating cash flows
69. Using the indirect method (statement of cash flows), an increase in current assets would:
A)be subtracted from net income
B)be added to net income
C)have no adjustment made to net income
D)be added to the investing section of the statement of cash flows
70. Using the indirect method (statement of cash flows), a decrease in current assets would:
A)be subtracted from net income
B)be added to net income
C)have no adjustment made to net income
D)be added to the investing section of the statement of cash flows
71. Using the indirect method (statement of cash flows), an increase in current liabilities would:
A)be subtracted from net income
B)be added to net income
C)have no adjustment made to net income
D)be added to the investing section of the statement of cash flows
72. Using the indirect method (statement of cash flows), a decrease in current liabilities would:
A)be subtracted from net income
B)be added to net income
C)have no adjustment made to net income
D)be added to the investing section of the statement of cash flows
73. Using the indirect method (statement of cash flows), a gain would:
A)be subtracted from net income
B)be added to net income
C)have no adjustment made to net income
D)be added to the investing section of the statement of cash flows
74. Using the indirect method (statement of cash flows), a loss would:
A)be subtracted from net income
B)be added to net income
C)have no adjustment made to net income
D)be added to the investing section of the statement of cash flows
75 Using the indirect method (statement of cash flows), depreciation expense would:
A)be subtracted from net income
B)be added to net income
C)have no adjustment made to net income
D)be added to the investing section of the statement of cash flows
