Question: When using the indirect method to complete the cash flows from operating activities section of the statement of cash flows, what is the proper disposition

When using the indirect method to complete the cash flows from operating activities section of the statement of cash flows, what is the proper disposition of a loss on disposal of equipment?

Disregard the loss because it relates to a financing activity.

Disregard the loss because it relates to an investing activity.

Subtract the loss from net income.

Add the loss to net income.

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