When using the T-account approach to preparing the indirect method of the statement of cash flows,which of the following would be associated with amounts entered on the credit side of the Cash T-account?
A)Increase in Inventory
B)Decrease in Accounts Receivable
C)Decrease in Inventory
D)Increase in Accrued Liabilities

Question

Quizplus · Accepted Answer

A decrease in Accounts Receivable would be listed as a credit in that T-account;the increase would be listed as a debit in the Cash T-account.An increase in Inventory would be listed as a debit in that T-account;the increase would be listed as a credit in the Cash T-account.A decrease in Inventory would be listed as a credit in that T-account;the increase would be listed as a debit in the Cash T-account.An increase in Accrued Liabilities would be listed as a credit in that T-account;the increase would be listed as a debit in the Cash T-account.

When Using the T-Account Approach to Preparing the Indirect Method