Question : What adjustments are required for a decrease or increase in Trade Payables/bills payable while calculating 'Cash flow from operating activities'?
Option 1: Deducted and added
Option 2: Added and deducted
Option 3: Added and added
Option 4: Deducted and deducted
Answer (1)
20th Jan, 2024
Correct Answer: Deducted and added
Solution : Answer = Deducted and added
A decrease in the value of current liabilities will increase the value of working capital and an increase in the value of current liabilities will decrease the value of working capital.
Hence, the correct option is 1.
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