When the net cash provided by operating activities is determined,an increase in income taxes payable should
A) be subtracted from the net cash amount after other calculations have been made.
B) be subtracted from the net income.
C) not be used in the calculation.
D) be added to the net income.

Question

Quizplus · Accepted Answer

An increase in income taxes payable indicates that the company has incurred tax expenses that have not yet been paid in cash. Therefore, it should be added back to net income when calculating net cash provided by operating activities using the indirect method.

When the Net Cash Provided by Operating Activities Is Determined,an