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.Service firms will likely show a small amount of

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