In a statement of cash flows prepared by the indirect method, which of the following events would be deducted from net income?
A)equity-method investment income in excess of dividends received
B)loss on the sale of an available-for-sale investment
C)proceeds from the sale of plant assets
D)amortization expense on a patent

Question

Quizplus · Accepted Answer

Equity-method investment income in excess of dividends received is deducted from net income because it represents income that has been recognized but not received in cash, thus it needs to be adjusted in the cash flow statement.

In a Statement of Cash Flows Prepared by the Indirect