A company's salaries payable account decreased by $1,000 during the year.Which of the following will appear on the statement of cash flows prepared using the indirect method?

Question

Quizplus · Accepted Answer

The decrease in salaries payable indicates that the company paid off some of its outstanding salaries during the year. Since salaries payable is a liability account, a decrease in the account is a deduction (or negative adjustment) to net income when preparing the statement of cash flows using the indirect method. This deduction is reported under operating activities as a cash outflow for operating expenses. Therefore, option D is the correct choice.

A Company's Salaries Payable Account Decreased by $1,000 During the Year.Which