In the statement of cash flows using indirect method, depreciation is treated as an adjustment to reported profit because depreciation a. reduces the reported profit and involves an outflow of cash. b. reduces the reported profit but does not involves an outflow of cash. c. is an outflow of cash for asset replacement d. represent a significant portion of operating expense

In the statement of cash flows using indirect method, depreciation is treated as an adjustment to reported profit because depreciation a. reduces the reported profit and involves an outflow of cash. b. reduces the reported profit but does not involves an outflow of cash. c. is an outflow of cash for asset replacement d. represent a significant portion of operating expense

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter23A: Statement Of Cash Flows: The Direct Method

Section: Chapter Questions

Problem 4RQ: Under the direct method of preparing a statement of cash flows, what adjustment is made for...

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