In preparing cash flows provided by operating activities using the indirect method, which of the following items is added to net income?                  I.    Non-cash expenses such as depreciation                  II.   Gains on investing and financing transactions                  III.  Increases in inventory balances                  IV.    Decreases in accounts payable balances   a-  I and IV only b- II and III only c- II, III and IV only d- I only

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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In preparing cash flows provided by operating activities using the indirect method, which of the following items is added to net income?

                 I.    Non-cash expenses such as depreciation

                 II.   Gains on investing and financing transactions

                 III.  Increases in inventory balances

                 IV.    Decreases in accounts payable balances

 

a-  I and IV only

b- II and III only

c- II, III and IV only

d- I only

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