Question: Your colleague is interested in using the direct method for their side business' cash flow statement and provides the following formulas for you to check.

Your colleague is interested in using the direct method for their side business' cash flow statement and provides the following formulas for you to check. Which formula is incorrect, if any?

Group of answer choices

Electricity expense - Decrease in electricity payable = Cash paid for electricity

All are correct

Salaries expense - Increase in salaries payable = Cash paid for salaries

Insurance expense + Increase in prepaid insurance = Cash paid for insurance

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