17. Which of the following below should be added to net income in calculating net cash flow from operating activities using the indirect method A. Gain on the sale of land. B. An increase in salaries payable. C. A decrease in accounts payable. D. An increase in accounts receivable. 18. Under the indirect method, expenses that do not affect cash are added to net income in the operating activities section of the statement of cash flows. A. True B. False 19. Common stock issued in exchange for land would be reported in the statement of cash flows in which of the following sections? A. Operating activities. B. Investing activities. C. Financing activities. D. None of the above. 20. A company that has free cash flow is able to find internal growth, retire debt, pay dividends, and benefit from financial flexibility. A True B. False 21. The percentage analysis of increases and decreases in individual items in comparative financial statements is called A. Solvency analysis B. Horizontal analysis. C. Profitability analysis. D. Vertical analysis. 22. One reason that a common size statement is a useful tool in financial analysis is that it enables the user to A. Determine which companies in a single industry are of the same size, B. Determine which companies in a single industry are of the same value. C. Make a better comparison of two companies of different sizes in the same industry. D. Judge the relative potential of two companies of similar size in different industries. 23. Walmart should have a higher inventory turnover ratio than TJ Maxx A Tree B. False 24. The current ratio is used to evaluate a company's liquidity and short-term debt paying ability A True. B. False