Which of the following would be subtracted from net income when determining cash flows from operating activities under the indirect method?

Noncash expenses such as depreciation are subtracted from net income when using the indirect method for computing cash flow from operating activities.

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How are cash equivalents treated on a statement of cash flows?

Cash equivalents are held for the purpose of meeting short – term cash commitments rather than for investment or other purposes. For an investment to qualify as a cash equivalent, it must be readily convertible to a known amount of cash and be subject to an insignificant risk of changes in value.


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Which of the following would be added to net income when determining cash flows from operating activities?

A decrease in accounts receivable would be added to net income when determining cash flows from operating activities under indirect method.

Which of the following would be an example of a financing activity on the statement of cash flows?

Examples of common cash flow items stemming from a firm’s financing activities are: Receiving cash from issuing stock or spending cash to repurchase shares. Receiving cash from issuing debt or paying down debt. Paying cash dividends to shareholders.

Which one of the following is subtracted from net income in determining cash flows from operations?

The correct answer is option (a). A decrease in utilities payable would be subtracted from net income when determining cash flows from operating…

Which of the following is included in the statement of cash flows?

The cash flow statement has 3 parts: operating, investing, and financing activities. There can also be a disclosure of non-cash activities.

Which of the following is an example of a cash equivalent?

Examples of cash equivalents include commercial paper, Treasury bills, and short-term government bonds with a maturity date of three months or less. Marketable securities and money market holdings are considered cash equivalents because they are liquid and not subject to material fluctuations in value.

Which of the following is an example of cash flows from operating activities?

Examples of cash inflows from operating activities are: Cash receipts from the sale of goods and services. Cash receipts from the collection of receivables. Cash receipts from lawsuit settlements.


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What would be the correct order in which the following would be listed on a statement of cash flows?

What would be the correct order in which the following would be listed on a statement of cash flows? cash flows from operating activities less cash used to purchase property, plant, and equipment.

What is cash outflow on statement of cash flows?

The cash outflow is: A) Reported as an operating activity. B) Reported as an investing activity. C) Reported as a financing activity. D) Not reported on a statement of cash flows. C.1) FD’s reported $9,000 of prepaid rent at December 31, 2020, and $13,000 at December 31, 2021.

How are cash equivalents reported in statement of cash flows?

Amounts held in cash equivalent investments must be reported separately from amounts held as cash in the statement of cash flows Nice work! You just studied 58 terms! Now up your study game with Learn mode.

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How are cash dividends treated in statement of cash flows?

D) Payment of a cash dividend declared in the previous fiscal year. D) Payment of a cash dividend declared in the previous fiscal year. B.1) When a transfer is made between cash and cash equivalents with no gain or loss, how is the transaction treated in the statement of cash flows?

What is disclosure of information about cash and cash equivalents?

Disclosure of information about cash and cash equivalents restricted as to withdrawal or usage. Amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits.