The Extent to Which a Firm Adjusts Net Income for Changes

Multiple Choice

The extent to which a firm adjusts net income for changes in noncurrent assets and noncurrent liabilities in deriving cash flow from operations depends on the nature of its operations. Firms that grow or diversify by acquiring minority ownership positions in other businesses will often show a

A) addition to retained earnings for distributed earnings.
B) addition to net income for distributed earnings.
C) subtraction from net income for equity in undistributed earnings.
D) addition to net income for equity in undistributed earnings.
E) subtraction from net income for distributed earnings.