27.Which statement is false regarding the preparation of the indirect method of the statement of cash flows?

a. Depreciation expense is added to net income.

b. An increase in merchandise inventory is subtracted from net income.

c. An increase in accounts payable is added to net income.

d. An increase in accounts receivable is added to net income.

15.

Which of the following would be considered a committed fixed cost (a cost that is incurred regardless of the level of activity during the period)?

a. advertising expense

b. bad debt expense

c. depreciation expense

d. cost of goods sold