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Which of the following should be deducted from net income in calculating net cash flow from
operating activities using the indirect method?
a. Depreciation expense
b. A loss on the sale of equipment
c. Gain on sale of land
d. Dividends declared and paid
Solution
Which of the following should be deducted from net income in calculating net cash flow from
operating activities using the indirect method?
Answer: C = Gain on sale of land.
TIP: While calculating CFO from the indirect method, we always add expenses and losses to the
net income and subtract income and gains from the net income.
I hope my solution solves your query.
Regards.

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Which of the following should be deducted from net income in calculati.docx

  • 1. Which of the following should be deducted from net income in calculating net cash flow from operating activities using the indirect method? a. Depreciation expense b. A loss on the sale of equipment c. Gain on sale of land d. Dividends declared and paid Solution Which of the following should be deducted from net income in calculating net cash flow from operating activities using the indirect method? Answer: C = Gain on sale of land. TIP: While calculating CFO from the indirect method, we always add expenses and losses to the net income and subtract income and gains from the net income. I hope my solution solves your query. Regards.