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- Which should be subtracted from the net income when using the indirectmethod? A. Loss on sale of investmentB. Amortization of patentC. Increase in accounts receivableD. Increase in accounts payable3. Any amount by which capital at the end of a period exceeds the amount required to maintain opening capital is ________. a. Profit b. Loss c. Asset d. LiabilityWhile calculating operating profit which will not be added back to net profit a. Preliminary Expenses Written off b. Depreciation c. Loss on Sale of Asset d. Rent Expenses
- Why is depreciation provided on non-current assets? а. so that the business entity concept is applied O b. so that there is enough cash in the business to replace them O c. so that the cost is allocated to periods that benefit from them O d. so that they are shown at market value1. If a Revaluation of an asset is done for the first time and there is a revaluation gain, this should be shown in a. Other Comprehensive Income as a Negative figure b. Other Comprehensive Income as a Positive figure c. The Statement of Profit and Loss Account as an Expense d. The Statement of Profit and Loss as IncomeWhen an intangible asset is amortized: OA. stockholders' equity decreases. OB. net assets decrease. C. net income decreases. D. all of the above are correct.
- Communication (income statement): The balance of Interest Expense from accruing interest to be paid has what effect on the income statement in the current year? Multiple Choice A. Decreases net income. B. No effect. C. Increases net income.If a company reports a gain/(loss) from the sale of assets, as part of the net income on the income statement, and the net book value of those assets on the date of the sale is known, can the amount of the cash proceeds from the sale be determined? If so, how?Which of the following would trigger a subtraction in the indirect operating section? A. gain on sale of investments B. depreciation expense C. decrease in accounts receivable D. decrease in bonds payable
- Discuss the appropriate treatment in the income statement for the following items: a. Loss on discontinued operations. b. Noncontrolling interest allocation. c. Earnings per share. d. Gain on sale of equipment.When do we use the Income Summary Account? O A. At the beginning of the financial year to close net income/net loss В. At the end of the financial year to close net income/ net loss C. At the end of the financial year to close gain/loss O D. At the beginning of the financial year to close gain/lossWhich of the below are the correct adjustments we make to a company's EBIT to arrive at its FCFF? Select all that apply. Select All That Apply A B D E F Take out taxes Subtract depreciation and amortization Subtract capital expenditures Add back acquisition expenses Subtract changes in net working capital Add back R&D expenses ?