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masha68 [24]
3 years ago
7

Which of the following should be added to the net income in calculating net cash flow from operating activities using the indire

ct method?
a. depreciation expense
b. an increase in inventory
c. a gain on the sale of equipment
d. dividends declared and paid
Business
1 answer:
liubo4ka [24]3 years ago
4 0

Answer:

a.

Explanation:

Operating Activities records the cash transactions involved in the operations of the business are recorded under ‘operating activities’ in the cash flow statement.  

Examples: Revenue earned, expenses incurred etc.  

There are two methods to prepare the cash flow statement. The only difference between both the methods is the way of presenting cash flow from operating activities.  

The two methods of presenting cash flow statement are:  

  1. Direct method: Operating activities section under direct method reports the amount of cash received and paid by the company during the period.  
  2. Indirect method: Operating activities section under indirect method reports the net income and later adjusts the transactions to convert it to cash basis of accounting.  

Depreciation expense is a non-cash operating expense. Thus, it is added back to the net income to derive net cash inflow from operating activities section of the cash flow statement.

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Answer:

c. Report $10,000 revenue and expense | Disclose in the notes

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Answer: Puresource Pharma would have to reduce it's cost

Explanation:

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3 years ago
Alzania produces and consumes​ 500,000 tons of cotton during a year. Reports indicate that​ Alzania's neighbor, which also emplo
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Answer:

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Explanation:

Alzania and its neighbor both produce cotton and they both have the same amount of workers in the production of cotton. If Alzania is able to produce more cotton (or any type of product) using the same amount of resources (in this case labor) than its neighbor, we can conclude that Alzania does have an absolute advantage in that industry.

This absolute advantage exists because Alzania's workers are more productive than their neighbor's workers.

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4 0
3 years ago
Le Place has sales of $439,000, depreciation of $32,000, and net working capital of $56,000. The firm has a tax rate of 34 perce
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Answer:

Explanation:

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Add depreciation $32,000

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Answer:

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