Amortization of the premium on bonds payable is subtracted from net income in the reconciliation of net income to cash flows from operations because
A) it is a financing cash outflow.
B) it reduces income without causing a cash outflow.
C) interest expense understates the cash paid for interest by the amount of the premium amortization.
D) it increases income without causing a cash flow.

Question

Quizplus · Accepted Answer

The Answer of Amortization of the premium on bonds payable is subtracted from net income in the reconciliation of net income to cash flows from operations because
A) it is a financing cash outflow.
B) it reduces income without causing a cash outflow.
C) interest expense understates the cash paid for interest by the amount of the premium amortization.
D) it increases income without causing a cash flow.

Amortization of the Premium on Bonds Payable Is Subtracted from Net