. The following information has been taken from the consolidation worksheet of G

Question

. The following information has been taken from the consolidation worksheet of Graham Company and its 80% owned subsidiary, Stage Company.
(1.) Graham reports a loss on sale of land of $5,000. The land cost Graham $20,000.
(2.) Noncontrolling interest in Stage's net income was $30,000.
(3.) Graham paid dividends of $15,000.
(4.) Stage paid dividends of $10,000.
(5.) Excess acquisition-date fair value over book value was expensed by $6,000.
(6.) Consolidated accounts receivable decreased by $8,000.
(7.) Consolidated accounts payable decreased by $7,000.

Using the indirect method, where does the decrease in accounts receivable appear in a consolidated statement of cash flows?
A. $8,000 increase to net income as an operating activity.
B. $8,000 decrease to net income as an operating activity.
C. $6,400 increase to net income as an operating activity.
D. $6,400 decrease to net income as an operating activity.
E. $8,000 increase as an investing activity.

Explanation / Answer

$8,000 decrease to net income as an operating activity

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.