Generally, an increase in a current liability results in an increase in the operating activities category of the cash flow statement.

Question

Quizplus · Accepted Answer

An increase in a current liability is typically due to an increase in an operating expense, such as accounts payable or accrued liabilities. This will result in a decrease in operating cash flow, as the company will have less cash on hand to pay for its operating expenses. Therefore, the increase in the current liability will be reflected in the operating activities category of the cash flow statement.

Generally, an Increase in a Current Liability Results in an Increase