Question

Statement I: Increase in provision for doubtful debts should be added back for calculating cash from operations.

Statement II: Dividend received is a Financing Activity.

(a) Statement I is correct and Statement II is incorrect

(b) Statement I and II is correct

(c) Statement I and Statement II is incorrect

(d) Statement I is incorrect, and Statement II is correct

Answer 1

Correct answer is (a) Statement I is correct and Statement II is incorrect

Increase in provision for doubtful debts should be added back for calculating cash from operations.