Excerpts from Aultman Corporation's comparative balance sheet appear below: Which of the following is the correct treatment within the operating activities section of the statement of cash flows using the indirect method?
A) The change in Inventory is added to net income; The change in Accounts Payable is added to net income
B) The change in Inventory is added to net income; The change in Accounts Payable is subtracted from net income
C) The change in Inventory is subtracted from net income; The change in Accounts Payable is added to net income
D) The change in Inventory is subtracted from net income; The change in Accounts Payable is subtracted from net income

Question

Excerpts from Aultman Corporation's comparative balance sheet appear below:  Which of the following is the correct treatment within the operating activities section of the statement of cash flows using the indirect method?
A) The change in Inventory is added to net income; The change in Accounts Payable is added to net income 
B) The change in Inventory is added to net income; The change in Accounts Payable is subtracted from net income 
C) The change in Inventory is subtracted from net income; The change in Accounts Payable is added to net income 
D) The change in Inventory is subtracted from net income; The change in Accounts Payable is subtracted from net income

Quizplus · Accepted Answer

The Answer of Excerpts from Aultman Corporation's comparative balance sheet appear below:  Which of the following is the correct treatment within the operating activities section of the statement of cash flows using the indirect method?
A) The change in Inventory is added to net income; The change in Accounts Payable is added to net income 
B) The change in Inventory is added to net income; The change in Accounts Payable is subtracted from net income 
C) The change in Inventory is subtracted from net income; The change in Accounts Payable is added to net income 
D) The change in Inventory is subtracted from net income; The change in Accounts Payable is subtracted from net income

Excerpts from Aultman Corporation's Comparative Balance Sheet Appear Below