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 under the indirect method depends on the nature of its operations.Capital-intensive firms will likely show a substantial

A) addback to net income for depreciation expense.
B) subtraction from net income for depreciation expense.
C) addback to net income for capital expenditures.
D) subtraction from net income for capital expenditures.
E) subtraction from retained earnings for depreciation expense.