medium · Financial Accounting statement-of-cash-flows
A customer pays $200 to settle an outstanding Account Receivable.
How does this transaction affect the Statement of Cash Flows using the indirect method?
- It is an add-back (increase) to Net Income in the Operating section.
- It is a subtraction from Net Income in the Operating section.
- It has no effect on the Statement of Cash Flows because the revenue was already recorded.
- It is reported as a cash inflow in the Financing section.
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