Destiny Corporation is preparing its statement of cash flows by the indirect method. Destiny has the following items for you to consider in preparing the statement:

________ a. Increase in accounts payable

________b. Payment of dividends

________c. Decrease in accrued liabilities

________d. Issuance of common stock

________e. Gain on sale of building

________f. Loss on sale of land

________g. Depreciation expense

________h. Increase in inventory

________i. Decrease in accounts receivable

________j. Purchase of equipment

Requirement

1. Identify each item as a(n)

● Operating activity—addition to net income (O+), or subtraction from net income (O–)

● Investing activity—addition to cash flow (I+), or subtraction from cash flow (I–)

● Financing activity—addition to cash flow (F+), or subtraction from cash flow (F–)

● Activity that is not used to prepare the indirect cash flow statement (N)