On the Statement of Cash Flows,which of the following would equal cash paid for income taxes?
A)income taxes payable plus change in cash
B)income taxes expense plus ending balance in income taxes payable
C)income taxes expense plus beginning balance in income taxes payable
D)income taxes expense plus change in income taxes payable

Question

Quizplus · Accepted Answer

Cash paid for income taxes is equal to income taxes expense plus the change in income taxes payable. Since income taxes payable is a liability account, an increase in the balance would represent taxes owed but not yet paid, and a decrease would represent taxes paid. Therefore, the change in income taxes payable represents the cash paid for income taxes.

On the Statement of Cash Flows,which of the Following Would