A company uses the indirect method to prepare the statement of cash flows. How will the adjustment to reflect the amount of cash payments to suppliers be presented on the statement?
A) The adjustment will be for the increase or decrease in accounts payable for the period and will adjust net income in the operating activities section.
B) The adjustment will be for the increase or decrease in inventory for the period and will adjust net income in the operating activities section.
C) The adjustment will be for the increase or decrease in accrued expenses for the period and will adjust net income in the operating activities section.
D) The adjustment will be for the increase or decrease in accounts receivable for the period and will adjust net income in the operating activities section.
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