To determine cash payments for operating expenses for the cash flow statement using the direct method, a decrease in accrued expenses is added to operating expenses other than depreciation.

Question

Quizplus · Accepted Answer

A decrease in accrued expenses represents an increase in cash payments for operating expenses, so it is added to operating expenses other than depreciation when using the direct method to determine cash payments for operating expenses for the cash flow statement.

To Determine Cash Payments for Operating Expenses for the Cash