Question

Depreciation on factory equipment would be reported in the statement of cash flows prepared by the indirect method in: a. the cash flows from operating activities section. b. a separate schedule. c. the cash flows from investing activities section. d. the cash flows from financing activities section.

Answer 1

Answer:

Correct answer is A cash flows from operating activities

Explanation:

Using indirect method in preparation of statement of cash flows, Depreciation and all other non cash expenses such as depletion and amortization will be presented under cash flows from operating activities. It will be added back to the income from the period before all other adjustments from the changes in the current assets and current liabilities.