1. For each of the following, identify whether it would be disclosed as an opera
ID: 2591627 • Letter: 1
Question
1.
For each of the following, identify whether it would be disclosed as an operating, financing , or investing activity on the statement of cash flows under the indirect method.
f. Depreciation expense _________
2.
Indicate whether each of the following would be added to or deducted from net income in determining net cash flow from operating activities by the indirect method:
a. Purchased buildings _________ b. Sold Patents __________ c. Net income _________ d. Issued Common Stock ________ e. Paid cash dividends _________f. Depreciation expense _________
2.
Indicate whether each of the following would be added to or deducted from net income in determining net cash flow from operating activities by the indirect method:
a. Increase in prepaid expenses ________ b. Amortization of patents ________ c. Increase in salaries payable __________ d. Gain on sale of fixed assets __________ e. Decrease in accounts receivable _________ f. Increase in notes receivable due in 60 days ________ g. Amortization of discount on bonds payable _________ h. Decrease in inventory _________ i. Depreciation of fixed assets _________ j. Loss on retirement of long-term debt _________ k. Decrease in accounts payable __________ l. Increase in notes payable due in 30 days __________ m. Increase in income taxes payable ___________Explanation / Answer
Solution:-
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Particulars Activity a. Purchased buildings Investing activity b. Sold Patents Investing activity c. Net income Operating activity d. Issued Common Stock Financing activity e. Paid cash dividends Financing activity f. Depreciation expense Operating activityRelated Questions
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