Which of the following items would be added to net income when using the indirect method of calculating cash flows provided by operating activities?
A)An decrease in accounts payable
B)An decrease in prepaid expenses
C)A decrease in accrued revenues
D)A decrease in taxes payable

Question

Quizplus · Accepted Answer

A decrease in prepaid expenses would be added to net income because it indicates that cash was not used for expenses that were previously paid, thus increasing cash flow.

Which of the Following Items Would Be Added to Net