Using the indirect method, which of the following would be added to net income?
A) increase in accounts receivable
B) increase in prepaid expenses
C) depreciation expense
D) decrease in accounts payable

Question

Quizplus · Accepted Answer

Depreciation expense is a non-cash charge that reduces net income but does not affect cash flow, so it is added back to net income in the indirect method of the cash flow statement.

Using the Indirect Method, Which of the Following Would Be