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Assume the indirect method is used to compute cash flows from operations. For each item listed below, indicate the effect on net income in arriving
Assume the indirect method is used to compute cash flows from operations. For each item listed below, indicate the effect on net income in arriving at eash flows from opentions by choosing one of the following code letters. Code Cash Flows From Operating Activities Add to Net locome Deduct from Net Income A 1. Increase in accounts receivable D 2. Increase in inventory 3. Decroase in prepaid expenses 4. Decrease in accounts payable. 5. Increase in accrued liabilities 6. Increase in income taxes payable. 7 Depreciation expense 8. Loss on sale of investment 9. Gain on disposal of equipment 10. Amortization expense
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