Match the letter with the correct item below to indicate how each revenue or expense account on the income statement is adjusted when using the direct method to determine net cash flow from operating activities.
A - Add item to revenue or expense
S - Subtract item from revenue or expense
N - No adjustment necessary
_______ increase in accrued expenses
_______ decrease in accounts receivable
_______ decrease in unearned income
_______ increase in prepaid expenses
_______ decrease in accounts payable
_______ increase in long-term notes payable
_______ decrease in prepaid insurance
_______ increase in inventory
_______ increase in interest payable
_______ increase in accumulated depreciation

Question

Quizplus · Accepted Answer

The Answer of Match the letter with the correct item below to indicate how each revenue or expense account on the income statement is adjusted when using the direct method to determine net cash flow from operating activities.
A - Add item to revenue or expense
S - Subtract item from revenue or expense
N - No adjustment necessary
_______ increase in accrued expenses
_______ decrease in accounts receivable
_______ decrease in unearned income
_______ increase in prepaid expenses
_______ decrease in accounts payable
_______ increase in long-term notes payable
_______ decrease in prepaid insurance
_______ increase in inventory
_______ increase in interest payable
_______ increase in accumulated depreciation

Match the Letter with the Correct Item Below to Indicate