Colorado Company uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance sheet: Colorado Company Comparative Balance Sheet December 31, 2025 and 2024 2025 2024 Accounts Payable Accrued Liabilities Long-term Notes Payable Total Liabilities $4,000 2,000 84,000 $90,000 $6,000 1,000 90,000 $97,000 Increase/(Decrease) $(2,000) 1,000 (6,000) $(7,000) How will the change in Accrued Liabilities be shown on the statement of cash flows? O as a deduction from Net Income O as an addition to Net Income O as a deduction from operating cash flows O as an addition to investing cash flows
Colorado Company uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance sheet: Colorado Company Comparative Balance Sheet December 31, 2025 and 2024 2025 2024 Accounts Payable Accrued Liabilities Long-term Notes Payable Total Liabilities $4,000 2,000 84,000 $90,000 $6,000 1,000 90,000 $97,000 Increase/(Decrease) $(2,000) 1,000 (6,000) $(7,000) How will the change in Accrued Liabilities be shown on the statement of cash flows? O as a deduction from Net Income O as an addition to Net Income O as a deduction from operating cash flows O as an addition to investing cash flows
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:Colorado Company uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance sheet:
Colorado Company
Comparative Balance Sheet
December 31, 2025 and 2024
2025
2024
Accounts Payable
Accrued Liabilities
Long-term Notes Payable
Total Liabilities
$4,000
2,000
84,000
$90,000
$6,000
1,000
90,000
$97,000
Increase/(Decrease)
$(2,000)
1,000
(6,000)
$(7,000)
How will the change in Accrued Liabilities be shown on the statement of cash flows?
as a deduction from Net Income
as an addition to Net Income
as a deduction from operating cash flows
as an addition to investing cash flows
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