Question
Why are impairment losses added back when converting net income to CFO under the indirect method?
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Answer
They reduce net income but are non-cash charges.
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Question
How does the indirect method reconcile net income to CFO for a loss on sale of a long-lived asset?
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Answer
Add back the loss to net income.
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Question
How does the indirect method reconcile net income to CFO for a gain on sale of a long-lived asset?
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Answer
Subtract the gain from net income.
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Question
Under US GAAP, how does an operating lease affect CFO for the lessee?
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Answer
The single straight-line lease expense is in CFO.
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