Which should be subtracted from the net income when using the indirect method? A. Loss on sale of investment B. Amortization of patent C. Increase in accounts receivable D. Increase in accounts payable

Q: The recognition of income occurs simultaneously with the recognition of decrease in assets or…

A: Income is recognized in the books of accounts of an entity if the value of assets is increasing, or…

Q: Which item could normally be treated similarly under both cash basis and accrual basis of…

A: Basis of the accounting is defined as the methodology under which the expenses as well as the…

Q: How should the following changes be treated, according to PAS 8? I. A change is to be made in the…

A: According to PAS 8 a change   is   to   be   made   in   the   method   of   calculating   the…

Q: Which of the following should be added to net income in calculating in net cash flow from operating…

A: Non cash expenditure like depreciation should be added to net income during indirect method.…

Q: Which of the following should be deducted from net income in calculating net cash flow from…

A: Cash flow statement: A cash flow statement is a final accounting statement to understand the change…

Q: answer true or false: gains are increases in net assets from peripheral activities while revenues…

A: First of all we have to understand the meaning of peripheral activities: these are the activity…

Q: If a company incorrectly records a payment as an asset, rather than as an expense, how will this…

A: Payments are made against the goods or services received. Hence, it is recorded as an expense.

Q: Which of the following will NOT appear in the cash flows from operating activities?

A: Answer:   Option e.

Q: Which of the following would be subtracted from net income when determining cash flows from…

A: Cashflow statement shows the cash inflow or outflow from various activities. Cashflow statement is…

Q: Which of the following would trigger a subtraction in the indirect operating section? A. decrease in…

A: The correct option is B that is, gain on sale of investments as it is a non-operating gain that is…

Q: Which of the following should be added to net income in calculating net cash flow from operating…

A: Cash flow statement provided information about the cash inflows and cash outflows of the company.…

Q: Which of the following should be deducted from net income in computing net cash flows from operating…

A: Introduction: Statement of cash flows: All cash in and out transactions in an accounting period is…

Q: Using the indirect technique, depreciation expenses are subtracted from net income before…

A: The indirect (addback) method begins by calculating net income on an accrual basis. Non-cash…

Q: Accounting The account "Net-Assets: Resources Released from Restriction" is used to: A) Reduce…

A: Correct option with proper explanation are as follows

Q: True or false. Debit Increases in assets and expenses, decreases in liabilities and revenue?

A: The different accounts in the business have debit and credit balance.  The assets and expenses have…

Q: If the indirect method is used, which of the following is a proper adjustment to net income to…

A: Financial statements are those reports and statements that are prepared at the end of accounting…

Q: The accumulated depreciation account in the statement of financial position will be treated as a…

A: Depreciation means the loss in value of assets because of usage of assets , passage of time or…

Q: Typically, the estimated amount available for short-term payments in a statement of affairs…

A: Statement of accounts: It is the periodic statements summarizing all the account activity of the…

Q: Indicate the effect that each transaction/event listed here will have on the financial ratio listed…

A: Transaction/Event Explanation a. Purchased inventory on account. Purchases of inventory on…

Q: Which of the following should be added to net income in calculating net cash flow from operating…

A: Cash flows from operating activities is a section in cash flow statement which shows all income and…

Q: Which of the following should be subtracted from net income in computing net cash flows from…

A: Introduction: Statement of cash flows: All cash in and out flows are shown in statement of cash…

Q: 7. How is the valuation of current assets affected if th OValuation is based on historical cost.…

A: Current assets are the assets that provide the financial benefit over a year. If the assets is held…

Q: Using accrual accounting, when is revenue recognized? A. When cash transfers B. When the…

A: There are two type of accounting merhods used in business. One is cash basis of accounting and other…

Q: Financial Asset at Fair Value under OCI would have its gain or loss reported at what Financial…

A: Gain or loss on Financial Asset at Fair Value under OCI will be shown as other comprehensive income…

Q: Which one of these statements is true of the accumulated depreciation account? O the account is to…

A: Accumulated depreciation is the total of depreciation applied on a fixed asset on a particular point…

Q: Which of the following questions cannot be answered when analyzing the information presented in an…

A: Answer: Income statement is the statement which shows the profit or loss when the revenue and…

Q: Which of the following should be deducted from net income in calculating net cash flow from…

A: To calculate net cash flow from operating activities using the indirect method, expenses or losses…

Q: Which of the following should be subtracted from net income in computing net cash flows from…

A:

Q: Which of the following should be subtracted from net income in computing net cash flows from…

A: Statement of cash flows: It is a financial statement that shows the increase or decrease in the cash…

Q: hance, a profit is period exceeds the amount of net assets at the beginning of the earned only if…

A: Physical capital maintenance : The physical capital is where capital of an organisation is regarded…

Q: indicate whether each of the following would be added to be or deducted from net income in…

A: In indirect method cash is added or deducted from net income to cash flow from operating activities…

Q: IDENTIFICATION OF AN ASSETS, LIABILITY, EQUITY, INCOME, EXPENSES or WITHDRAWAL For each of the…

A: The financial statements are prepared by passing the journal entries, adjusting entries,…

Q: Why is depreciation on the income statement different from the depreciation on the balance sheet?

A: Depreciation is the reduction in the value of asset during a period of time due to wear and tear.…

Q: Which of the following will be reflected in the "Cash flows from operating activities" of a…

A: Cash flow statement is a statement which shows all cash inflows and cash outflows of the business…

Q: Which of the following has a different effect on net profit than it does on cashflow? A.Cash sale…

A: Net Profit will be affected by revenues and expenses whether accrual or cash basis. On the other…

Q: Which item could normally be treated similarly under both cash basis and accrual basis of…

A: Cash basis of accounting is a system in which all revenues and expenses in cash are recorded for…

Q: Which of the following is true regarding unearned revenue? Assets are increased when unearned…

A: The revenue or income which is received even before the providence of services or selling of goods…

Q: Which of the following should be added to net income in calculating net cash flow from operating…

A: Cash flow from operating activities includes the cash inflows and outflows from the business…

Q: Which of the following will be reflected in the "Cash flows from operating activities" of a…

A: Cash flow from the operating activities refers to the inflows and outflows of the cash in the entity…

Q: Indicate the effect of the transactions listed in the following table on total current assets,…

A: A fixed asset is sold for more than book value: If fixed asset is sold, cash will be come into the…

Q: Can stright line depreciation method be used to manage earnings. Explain

A: A depreciation expense reduces net earnings when the asset's cost is allocated on the income…

Q: What effect does the recognition of depreciation expense have on total assets?  On total equity

A: Depreciation expense is recorded by debiting the depreciaton expense account and crediting…