Under the indirect method to prepare the statement of cash flows,a loss on the sale of long-term assets is added to net income when calculating Net cash provided by operating activities.

Question

Quizplus · Accepted Answer

Under the indirect method, a loss on the sale of long-term assets is added back to net income to calculate net cash provided by operating activities. This is because the loss is a non-cash expense and does not affect the cash flows from operating activities.

Under the Indirect Method to Prepare the Statement of Cash