Which of the following would be shown as a deduction from net income when calculating net cash flow from operating activities using the indirect method?
A) Decrease in accounts payable for inventory purchases
B) Loss on the sale of equipment
C) Decrease in accounts receivable
D) Increase in salaries payable

Question

Quizplus · Accepted Answer

A decrease in accounts payable for inventory purchases is shown as a deduction from net income when calculating net cash flow from operating activities using the indirect method because it represents a cash outflow that does not affect net income directly.

Which of the Following Would Be Shown as a Deduction