Which of the following is a deduction from net income when reconciling to cash flow from operating activities?
A) Amortization of premium on bonds payable
B) Cash dividend declared and paid
C) Collection of an account receivable
D) Bad debt written off (allowance method)

Question

Quizplus · Accepted Answer

Amortization of premium on bonds payable is a non-cash expense that is added back to net income when reconciling to cash flow from operating activities because it reduces net income but does not involve an outflow of cash.

Which of the Following Is a Deduction from Net Income