Operating expenses other than depreciation for the year were $400,000.Accrued expenses increased by $35,000.Cash payments for operating expenses to be reported on the cash flow statement using the direct method would be:

Question

Quizplus · Accepted Answer

The cash payments for operating expenses using the direct method are calculated by adding the increase or subtracting the decrease in accrued expenses to the operating expenses other than depreciation. Therefore, the cash payments for operating expenses are $400,000 + $35,000 = $435,000. Thus, the best choice is C.

Operating Expenses Other Than Depreciation for the Year Were $400,000