Using the indirect method, where does the decrease in accounts payable appear in a consolidated statement of cash flows?
A) $7,000 increase to net income as an operating activity.
B) $7,000 decrease to net income as an operating activity.
C) $5,600 increase to net income as an operating activity.
D) $5,600 decrease to net income as an operating activity.
E) $7,000 increase as a financing activity.

Question

Quizplus · Accepted Answer

A decrease in accounts payable is subtracted from net income in the operating activities section of the cash flow statement using the indirect method.

Using the Indirect Method, Where Does the Decrease in Accounts