1) On an indirect method statement of cash flows, a decrease in inventory would be: A.reflected in the investing activities section B.deducted from net income C.netted against any decreases in accounts payable D.added to net income

2) Sometimes income and cash flow follow different patterns. True False

3)Cash means more than just cash on hand and cash in the bank. Highly liquid, shortminusterm investments that are easily convertible into cash are called:

A.cash equivalents

B.accounts receivable

C.promissory notes

D.common shares

4) On an indirect method statement of cash flows, the purchase of machinery in exchange for common shares is:

A.reflected in the investing activities section

B.shown in the schedule of noncash investing and financing activities which accompanies the statement of cash flows

C.reflected in the operating activities section

D.ignored

5) Which of the following activities increase and decrease the nonminuscurrent assets available to a company?

A.financing activities

B.warehousing activities

C.operating activities

D.investing activities