25. Which of the following is not needed to prepare a statement of cash flows?

A. Statement of retained earnings. B. Comparative balance sheet. C. Additional information on financing and investing activities. D. Income statement.

26. What is the first step in calculating cash flows from operations when the indirect method is used?

A. Find net income on the income statement. B. Calculate the net change in the cash account. C. Add the change in accounts receivable to sales revenue. D. Identify the balance sheet accounts that relate to operating activities.

27. When the direct method is used to determine the net cash flows from operating activities, which of the following adjustments must be made to interest expense to determine total interest payments?

A. Add all changes in interest payable. B. Add decreases in interest payable and subtract increases in interest payable. C. Add increases in interest payable and subtract decreases in interest payable. D. Subtract all changes in interest payable.