Question
A company uses the indirect method to prepare the statement of cash flows. It presents the following data on its financial statements: End of this
A company uses the indirect method to prepare the statement of cash flows. It presents the following data on its financial statements: End of this year End of prior year Accounts receivable Cost of goods sold Sales revenue Accounts payable* Inventory Salary payable $115,000 $100,000 560,000 830,000 75,000 67,000 86,000 105,000 16,000 9,000 49,000 45,000 Salary expense "Relates solely to the acquisition of inventory What will appear in the operating activities section related to salary payable? A. The increase of $7,000 will be added to cost of goods sold. B. The increase of $7,000 will be subtracted from net income. C. The increase of $7,000 will be subtracted from cost of goods sold. D. The increase of $7,000 will be added to net income
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started