Question : To Calculate Cash Flow Operating Activities, which of the following will be deducted?
Option 1: Increase in Trade Payables
Option 2: Decrease in Trade Payables
Option 3: Decrease in Inventories
Option 4: Decrease in Trade Receivables

Question

Question : To Calculate Cash Flow Operating Activities, which of the following will be deducted?

Option 1: Increase in Trade Payables

Option 2: Decrease in Trade Payables

Option 3: Decrease in Inventories

Option 4: Decrease in Trade Receivables

Team Careers360 · Accepted Answer

Correct Answer: Decrease in Trade Payables

Solution : It's the reverse of an increase in accounts payable, as you might now anticipate. If the amount owed to vendors or suppliers has reduced, this indicates that money has really been paid to them, leaving the business with less cash. Because of this, a Decrease in accounts payable signals a decline in cash flow.Hence it will be deducted from Operating activity.

Hence the correct answer is option 2.

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Question : To Calculate Cash Flow Operating Activities, which of the following will be deducted?Option 1: Increase in Trade PayablesOption 2: Decrease in Trade PayablesOption 3: Decrease in InventoriesOption 4: Decrease in Trade Receivables

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Question : To Calculate Cash Flow Operating Activities, which of the following will be deducted?
Option 1: Increase in Trade Payables
Option 2: Decrease in Trade Payables
Option 3: Decrease in Inventories
Option 4: Decrease in Trade Receivables

Question : Cash Flow from Operating Activities + Cash Flow from Investing Activities + Cash
Flow from Financing Activities =