Among the following items given which is/are needed to be added to get
| Among the following items given which is/are needed to be added to get net cash from operating activities while preparing Cash Flow Statements?
I. Increase in current liabilities
II. Decrease in current liabilities
III. Increase in current assets
IV. Income tax paid
A. Only I
B. Only I and III
C. Only II and IV
D. Only III
Right Answer is: A
SOLUTION
• Cash flow from operating activities
Net Income
Add- Depreciation expenses
Increase in accounts receivable
Decrease in inventory
The decrease in accounts payable
Cash provided in operating activities (Total)
• Increase in current liabilities needed to be added to get net cash from
operating activities while preparing Cash Flow Statements.
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