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  3. 1. which of the following would be subtracted from

1. Which of the following would be subtracted from net income using the indirect method?...

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Accounting

1. Which of the following would be subtracted from net income using the indirect method?

  • A. loss on sale of equipment.
  • B. a decrease in accounts payable.
  • C. an increase in long-term investments
  • D. depreciation expense

2. The acquisition of land by issuing common stock is

  • A. a cash transaction that is reported in the investing section in the body of the statement of cash flows.
  • B. a noncash transaction that is disclosed in a supplementary schedule attached to the statement of cash flows.
  • C. a noncash transaction that is reported in the operating section in the body of the statement of cash flows.
  • D. only reported if the statement of cash flows is prepared using the direct method.

3.In general terms, a sound capital investment will earn

  • A. back its original capital outlay and provide a reasonable return on the original investment.
  • B. back its original capital outlay by the midpoint of its useful life.
  • C. back its original capital outlay.
  • D. a return greater than existing capital investments

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