In preparing cash flows provided by operating activities using the indirect method, which of the following items is added to net income? O Non-cash expenses such as depreciation. O Decreases in current asset balances. O Gains on investing and financing transactions. O Both non-cash expenses such as depreciation and decreases in current asset balances, but not gains on investing and financing transactions. Which of the following is a cash flow resulting from a financing activity? O Declaring a dividend on common stock. O Receiving a cash dividend on an investment in another company. 0 Issuing 1,000 shares of preferred stock. O Purchasing an automobile by borrowing money from the bank. Which of the following is not a source of cash? O Dividends received on investment. O Borrowing $5,000 on short-term note. O Gain on sale of warehouse. O All of these answer choices are sources of cash. Which of the following would be considered an investing activity and a source of cash? 0 Issuance of corporate stock O Receipt of interest on savings account O Sale of Dillard's stock held as an investment O Purchase of equipment Which of the following would be considered a financing activity and a source of cash on the statement of cash flows? O Payment from customers O Borrowing on a long-term debt O Purchase of treasury stock O Sale of land Which of the following is an advantage of a company using equity rather than debt to finance a project? O Dividends do not need to be paid. O Interest is tax deductible whereas dividends paid are not. O Dividends always require less cash than does paying interest on debt. O No taxation similar to bonds