When preparing the statement of cash flows under the indirect method,an appropriate procedure would be to
A)add a loss from the sale of a fixed asset.
B)add an increase in accounts receivable.
C)subtract depreciation expense.
D)subtract an increase in accounts payable.
E)determine cash received from customers.

Question

Quizplus · Accepted Answer

Under the indirect method, a loss from the sale of a fixed asset is added back to net income because it is a non-cash expense that reduced net income.

When Preparing the Statement of Cash Flows Under the Indirect