First Principles Thinking: core idea
A is correct. The CFA Curriculum states that non-cash expenses are added back to net income under the indirect method. Depreciation expense reduces net income but does not use cash in the current period, so it is added back in reconciling to operating cash flow. This is a standard non-cash adjustment.
Why top distractor is wrong (PDF-based misconception): B is subtracted, not added, because an increase in accounts receivable means revenue exceeded cash collected.
Why remaining distractor is wrong: C is also subtracted because the gain is non-operating and its cash effect belongs in investing activities.