Operating expenses (other than depreciation) for the year were $360,000. Accrued expenses increased by $37,000. Cash payments for operating expenses to be reported on the cash flow statement using the direct method would be:
A) $397,000.
B) $360,000.
C) $323,000.
D) $37,000.
C) $323,000.
Explanation: operating expenses - increase in accrued expense; ex: $360,000 - $37,000 = $323,000
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