91Ó°ÊÓ

On its income statement for a recent year, Northwest Airlines Corporation reported a net loss of \(\$ 862\) million from operations. On its statement of cash flows, it reported \(\$ 271\) million of cash flows from operating activities. Explain this apparent contradiction between the loss and the positive cash flows.

Indicate whether each of the following would be added to or deducted from net income in determining net cash flow from operating activities by the indirect method: a. Gain on retirement of long-term debt b. Increase in merchandise inventory c. Amortization of patent d. Decrease in accounts receivable e. Depreciation of fixed assets f. Decrease in prepaid expenses g. Decrease in salaries payable h. Increase in notes receivable due in 90 days from customers i. Decrease in accounts payable j. Loss on disposal of fixed assets k. Increase in notes payable due in 90 days to vendors