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An increase in the Accounts Receivable account of a company from $20,000 at the beginning of the year to $25,000 at the end of the

An increase in the Accounts Receivable account of a company from $20,000 at the beginning of the year to $25,000 at the end of the year would be shown on the company's statement of cash flows prepared under the indirect method as:


  • an addition to net income of $5,000 in order to arrive at cash flows from operating activities.

  • an addition to net income of $15,000 in order to arrive at cash flows from operating activities.

  • a deduction from net income of $5,000 in order to arrive at cash flows from operating activities.

  • a deduction from net income of $10,000 in order to arrive at cash flows from operating activities.

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