Company statement of cash flows-indirect method


An increase in the Accounts Receivable account of a company from $40,000 at the beginning of the year to $60,000 at the end of the year would be shown on the company's statement of cash flows prepared under the indirect method as:

A) an addition to net income of $20,000 in order to arrive at cash flows from operating activities.

B) an addition to net income of $40,000 in order to arrive at cash flows from operating activities.

C) a deduction from net income of $20,000 in order to arrive at cash flows from operating activities.

D) a deduction from net income of $60,000 in order to arrive at cash flows from operating activities.

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Accounting Basics: Company statement of cash flows-indirect method
Reference No:- TGS0515133

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