Which Item Is a Noncash Item That Would Be Added

Multiple Choice

Which item is a noncash item that would be added to net income to convert it to cash flow from operating activities?

A) Accounts receivable.
B) Depreciation.
C) Accounts payable.
D) Inventory.
Use the indirect method to answer questions 7-10.The following information is available for Armstrong Company:
$$\begin{array} { l r l r } \text { Net income } & \$ 450 & \text { Increase in plant and equip. } & \$ 170 \\\text { Depreciation expense } & 80 & \text { Payment of dividends } & 10 \\\text { Decrease in accts. receiv. } & 20 & \text { Increase in long-term debt } & 100 \\\text { Increase in inventories } & 15 & \text { Decrease in accounts payable } & 30\end{array}$$