In a statement of cash flows using the indirect method, an increase in the available-for-sale debt securities account due to an increase in the debt's fair value should be reported as:
A) A deduction from net income in determining cash flows from operating activities.
B) An addition to net income in determining cash flows from operating activities.
C) An investing activity.
D) Not reported.

Question

Quizplus · Accepted Answer

The unrealized gain increased other comprehensive income, not net income, and is not a cash flow.

In a Statement of Cash Flows Using the Indirect Method