Changes in all current assets EXCEPT ________ are adjustments to net income in the operating section of an indirect cash flow statement.

Question

Quizplus · Accepted Answer

Changes in cash are not adjusted for in the operating section of an indirect cash flow statement because the statement itself is a reconciliation of net income to net cash provided by operating activities. Changes in other current assets (like prepaid expenses, inventory, and notes receivable) are adjusted because they affect net income but do not involve cash movement during the period.

Changes in All Current Assets EXCEPT ________ Are Adjustments to Net