Respond that the following statements are True or False:

1. When accounts receivable decrease during a period, cash-basis revenues are higher than revenues reported on an accrual basis

2. When prepaid expenses decrease during a period, expenses on the accrual-basis are lower than they are on a cash-basis.

3. Under the accrual basis of accounting, net income is usually the same as net cash flow from operating activities

4. A company can convert net income to net cash flow from operating activities through either the direct method or the indirect method.

5. Income from an investment in common stock using the equity method is added to net income in computing net cash provided from operating activities

Answer rating: 100% (QA)

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