Under the direct method of determining the net cash provided by operating activities on the statement of cash flows,an increase in income taxes payable would be subtracted from income tax expense to convert income tax expense to a cash basis.

Question

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Under the direct method, changes in current asset and liability accounts are directly adjusted to convert accrual basis figures to cash basis figures. An increase in income taxes payable is a current liability account and would be subtracted from income tax expense to arrive at the cash paid for income taxes during the period.

Under the Direct Method of Determining the Net Cash Provided