In creating a statement of cash flows using the indirect method, we consider that an increase in current assets causes a decrease in cash.

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This is because an increase in current assets, such as accounts receivable or inventory, means that cash has been tied up in those assets and is not available for immediate use. This results in a decrease in cash, and is reflected in the operating activities section of the statement of cash flows using the indirect method.

In Creating a Statement of Cash Flows Using the Indirect