Question: On its income statement for the year, Crescent Ltd. reported $100,000 of selling and administrative expenses, which included $20,000 in depreciation expense. During the year

On its income statement for the year, Crescent Ltd. reported $100,000 of selling and administrative expenses, which included $20,000 in depreciation expense. During the year prepaid expenses associated with selling and administration increased by $8,000. If Crescent uses the direct method to report cash flows from operating activities,

how would it treat these amounts?

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