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Pachacha [2.7K]
1 year ago
10

If a company is using the indirect method to prepare the statement of cash flows, a decrease in the inventory account should be

reported as:
Business
1 answer:
zubka84 [21]1 year ago
3 0

If a company is using the indirect method to prepare the statement of cash flows, a decrease in the inventory account should be reported as a decrease in cash flows from operating activities.

<h3>An indirect method to prepare the statement of cash flows</h3>
  • The statement of cash flows is prepared indirectly by adjusting net income for changes in balance sheet accounts in order to determine the amount of cash generated by operational activities.
  • One of the parts of a firm's set of financial statements, the statement of cash flows, is used to show where a company gets its money from and what it does with it.
  • It provides details on the cash generated by operations and the impact of various balance sheet modifications on a company's cash position.
  • The indirect mode of presenting is particularly common since the data needed for it can be gathered rather quickly from the accounts that a company typically has in its chart of accounts.

To learn more about the indirect method to prepare the statement of cash flows refer to:

brainly.com/question/17537007

#SPJ4

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We can also think that most people don't like the crust of the pizza. Two pizzas have more crust than one. So one pizza, besides being bigger, can save you to eat the crust and more cheese and sauce.

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