Question: Assuming that Sonic Company uses the indirect method for the statement of cash flows, an activity may classified into the categories as follows: a. Operating

Assuming that Sonic Company uses the indirect method for the statement

Assuming that Sonic Company uses the indirect method for the statement of cash flows, an activity may classified into the categories as follows: a. Operating activity-add to net income b. Operating activity-subtract from net income c. Investing activity-cash inflow d. Investing activity-cash outflow e. Financing activity-cash inflow f. Financing activity-cash outflow g. Noncash transaction An increase in prepaid expenses should be reported as: Operating activity-subtract from net income. Operating activity-add to net income. O Investing activity-cash outflow. Noncash transaction

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