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Use the Equation Presented Below to Answer the Question That

Question 68

Multiple Choice

Use the equation presented below to answer the question that follows:
Cash = CL + LTL + CS + RE - NCCA - LTA
Where: CL = Current liabilities
LTL = Long-term liabilities
CS = Common stock
RE = Retained earnings
NCCA = Noncash current assets
LTA = Long-term assets
Which of the following activities results in a cash outflow?


A) Decreases in noncash current assets NCCA)
B) Decreases in long-term assets LTA)
C) Increases in long-term liabilities LTL)
D) Decreases in retained earnings RE)

Correct Answer:

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