Answer:
600 loss
Explanation:
The computation of the gain or loss is shown below:
Since on Jan, there is a put option of 45 at $3 and the market rises to $58
So it losses by 13 points i.e
= 45 - 58
= 13
Now the total premium points collected is of 7 i.e
= 4 + 3
= 7
So, the remaining points left is
= 13 - 7
= 6
So for 6 points, the net loss is $600
Michelle gives out a business card with an e-mail address on it. According to the comments that accompany the UETA, it may be reasonable to infer that Michelle has consented to
Answer:
Explanation:
transact business electronically.
Luther Corporation Consolidated Balance Sheet December 31, 2006 and 2005 (in $ millions) Assets 2006 2005 Liabilities and Stockholders' Equity 2006 2005 Current Assets Current Liabilities Cash 58.5 Accounts payable 73.5 Accounts receivable 39.6 Notes payable / shortterm debt 9.6 Inventories 42.9 Current maturities of longterm debt 36.9 Other current assets 3.0 Other current liabilities 6.0 12.0 Total current assets 144.0 Total current liabilities 132.0 LongTerm Assets LongTerm Liabilities Land 62.1 Longterm debt 168.9 Buildings 91.5 Capital lease obligations Equipment 99.6 Less accumulated depreciation () (52.5) Deferred taxes 22.8 22.2 Net property, plant, and equipment 200.7 Other longterm liabilities Goodwill 60.0 Total longterm liabilities 191.1 Other longterm assets 63.0 42.0 Total liabilities 323.1 Total longterm assets 242.7 Stockholders' Equity 63.6 Total Assets 386.7 Total liabilities and Stockholders' Equity 386.7 Refer to the balance sheet above. Luther's current ratio for 2006 is closest to:
Answer:
Luther Corporation
Current Ratio for 2006 is closest to:
1.1 : 1
Explanation:
a) Data and Calculations:
Total Current Assets = $144 million
Total Current Liabilities = $132 million
Current Ratio = Current Assets/Current Liabilities
= $144/$132
= 1.1 : 1
b) Luther Corporation's current ratio is a liquidity measure that shows Luther's ability to pay off short-term obligations worth $132 million or those due within one year with its current assets of $144 million. The ratio tells investors and analysts of Luther Corporation how Luther can use its current assets to pay off its current debts. Since Luther's current ratio is higher than 1, it is considered good, depending on the industry average. This means that Luther's current ratio of 1.1 : 1 should not be considered in isolation, but in comparison with other firms in the industry and its performance over a number of years.
Margin on price as a percentage is the expression of how much you mark your product up by to arrive at your retail price. True False
Answer:
False
Explanation:
The margin on price refers to a percentage by taking a difference between the gross profit and the selling price
Here gross profit comes by
= Selling price - cost price
Now in the cost price we added some markup percentage i.e most probably equivalent to the retail price
Hence, the given statement is false
Keith, an employee of Sunbeam, Inc., has gross salary for May of $15,000. The entire amount is under the OASDI limit of $118,500 and thus subject to FICA. He is also subject to federal income tax at a rate of 20%. Which of the following is a part of the journal entry to record the disbursement of his net pay? (Assume a FICAOASDI Tax of 6.2% and FICAMedicare Tax of 1.45%.) (Round the final answer to the nearest dollar.)
Answer:
there are no options listed, but the journal entry to record Keith's salary should be:
May 31, wages expense
Dr Wages expense 15,000
Dr FICA taxes expense 1,147.50
Dr FUTA taxes expense 900
Cr Federal income taxes withheld payable 3,000
Cr FICA OASDI taxes withheld payable 930
Cr FICA Medicare taxes withheld payable 217.50
Cr FICA OASDI taxes payable 930
Cr FICA Medicare taxes payable 217.50
Cr Wages payable 10,852.50
I didn't include SUTA taxes or any other discount (e.g. health insurance, IRA contributions, union contributions, etc.) because sometimes they do not exist, but the previous ones always exist.
Which of the following is NOT a benefit of a social media presence for a brand? Group of answer choices Social media allows companies to have a short-term focus. Social media allows marketers to establish a public voice and presence online. Social media can cost-effectively reinforce other communication activities. Social media can encourage companies to stay innovative and relevant. Social media can be used to build or tap into online communities.
Answer: Social media allows companies to have a short-term focus.
Explanation:
Social Media has made the world way more connected than it was before even with the advent of the Internet. As such, companies were able to leverage on this to improve their brand and popularity by being present on the various social media platforms.
With social media, companies have been able to marketers to establish a public voice and presence online, cost-effectively reinforce other communication activities, build online forums and communities as well as remain relevant in a fast changing world.
Companies having a short term focus as a result of social media is not a benefit of social media. A company should always think long term and even social media can help them achieve long term growth if long term marketing plans are integrated with social media marketing.
Speedy Runner makes running shoes and they have gathered the following data for the month of October: Data Cash on 10/1 Expected Cash Collections Direct Materials Cash Disbursements Direct Labor Cash Disbursements MOH Cash Disbursements Operating Expenses Cash Disbursements Capital Expenditures Cash Disbursements Speedy Runner requires an ending cash balance of at least $12,000 and can borrow from a line of credit in $1,000 increments. How much will Speedy Runner need to borrow at the end of October?
Answer: $9,000
Explanation:
Speedy Runner will need to borrow the amount of cash disbursements that will exceed their cash receipts.
= Opening Cash + Cash Receipts - Cash Disbursements
= Opening Cash + Expected Cash Collections - Direct Labor Cash - Direct Materials Cash Disbursements - Operating Expenses Cash Disbursements - MOH Cash Disbursements - Capital Expenditures Cash Disbursements - Ending cash balance requirement
= 15,300 + 435,000 - 32,000 - 80,000 - 110,000 - 25,000 - 200,000 - 12,000
= $8,700
They can borrow in incremental terms of $1,000 so to cover the cash requirements they should borrow $9,000.
A company's gross profit (or gross margin) was $129,650 and its net sales were $502,900. Its gross margin ratio is
Answer:
25.8%
Explanation:
A company gross profit is $129,650
The net sales is $502,900
Therefore, the gross margin ratio can be calculated as follows
Gross margin ratio= gross margin /net sales
= $129,650/$502,900
= 0.258×100
= 25.8%
Hence the gross margin ratio is 25.8%
A decline in the domestic real interest rate would cause a ________ in net exports and a ________ in the exchange rate.
Answer: fall; rise
Explanation:
The real interest rate is the rate of interest that is received by an investor, lender or after inflation has been taken into consideration.
The real interest rate is when the inflation rate is deducted from the nominal interest rate. A reduction in the domestic real interest rate would cause a fall in net exports and a rise in the exchange rate.
Prepare the journal entry to record Jevonte Company’s issuance of 35,000 shares of its common stock assuming the shares have a: $3 par value and sell for $22 cash per share. $3 stated value and sell for $22 cash per share.
Answer: Please see answer in explanation column
Explanation:
a)journal entry to record Jevonte Company’s issuance at $3 par value and $22 cash per share
Account Debit Credit
Cash(35,000 x $22) $770,000
Common stock, $3 par value(35,000 x 3) $105, 000
Paid-in captial in excess of par value, common stock
($770,000 - $105, 000 ) $665,000
b)journal entry to record Jevonte Company’s issuance at $3 stated value and $22 cash per share
Account Debit Credit
Cash (35,000 x $22) $770,000
Common stock, $3 stated value (35,000 x 3) $105, 000
Paid-in captial in excess of stated value, common stock
($770,000 - $105, 000 ) $665,000
An organizationally-driven reason for outsourcing is that it can improve effectiveness by focusing on what the firm does best.
Answer:
True
Explanation:
Outsourcing is when a company gives some of its internal activities to an external party that takes the responsibility to get things done and one of the reasons for a company to do this is to get rid of activities that have to get done but that are not part of their core operations to be able to concentrate on their main activity and get those things done by experts which can help increase productivity. According to that, the answer is that the statement is true.
Your textbook discussed a model of a simple economy with four markets: labor, capital, energy, and food. Which of the following statements is inconsistent with a general equilibrium for this simple economy?
A. The household demand for energy equals the industry supply of energy.
B. The household demand for food equals the industry supply of food.
C. The household demand for labor equals the industry supply of labor.
D. The household supply of capital equals the industry demand for capital.
Answer:
The correct answer is the option C: The household demand for labor equals the industry supply of labor
Explanation:
To begin with, when it comes to the microeconomics theory the market of labor is considered to be as a factor of production market and from that point of view the labor is demanded by the companies to the households who are the ones who offered the labor due to the fact that the workers are the one who put their force to disposition of the companies. And that is why that it would be inconsistent to say that the household demand for labor will equals the industry supply of labor, because it is all the way around, the household supply of labor will equals the industry demand of it.
Projectized organizations are especially effective at helping team members to maintain their discipline-specific competencies. Group of answer choices
Answer: False
Explanation:
A projectized organization is a form of organization structure is that is designed such that it is hierarchical and headed by the project manager who is typically involved in every decision that is made regarding the project as he or she is the one that team members report to.
Therefore, projectized organizations are not effective at helping team members to maintain their discipline-specific competencies.
As the workforce becomes more diverse, why does performance appraisal become a more difficult process?
Answer:
Performance appraisal in a company with diverse workforce becomes difficult because of some cultural biases that may exist between the manager, who is doing the appraisal, and the diverse workforce. This problem becomes more acute if the manager is culturally biased and discriminatory by practise.
Explanation:
Company A can have a diverse workforce if it is made up of employees from culturally different places working together in the same workplace. Bias often arises due to human cultural nuisances. This becomes more obvious where managers are from some particular cultures while the employees are from mixed cultures. In such situations, the managers need to be retrained to enable them embrace cultural diversity in the workplace and in performance evaluation.
The key cause due to which the performance appraisal becomes problematic due to diversity in the workforce would be:
- Cultural bias
What is performance appraisal?
Performance appraisal is described as the process of reviewing the performances done by the employees in a particular organization to attain its goals and reward them accordingly.
When the workforce of a particular company or organization becomes exceedingly diverse, it becomes problematic to do performance appraisals.
The reason behind this is that this diversity gives rise to cultural biases and may result in discrimination.
Learn more about "Performance" here:
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A small distribution organization uses a payroll company to provide employee compensation services and keep timesheet records and employee attendance history. This situation is an example of
Complete Question:
A small distribution organization uses a payroll company to provide employee compensation services and keep timesheet records and employee attendance history. This situation is an example of?
Group of answer choices.
A. Offshoring
B. Centralized work surveillance.
C. Outsourcing.
D. Telecommuting.
Answer:
Outsourcing.
Explanation:
When a small distribution organization uses a payroll company to provide employee compensation services and keep timesheet records and employee attendance history. This situation is an example of outsourcing.
Outsourcing can be defined as a contractual agreement in which a company contracts another firm (third-party) to be responsible for providing certain job functions, tasks or services rather than use employees or departments within the company.
In this scenario, the outsourcing firm or company is saddled with the responsibility of providing employees compensation services, keep timesheet records, and manage the attendance history of employees working at the outsourced distribution organization.
The Atlantic Division of Stark Productions Company reported the following results for 2019:
Sales $4,000,000
Variable costs 3,200,000
Controllable fixed costs 300,000
Average operating assets 2,500,000
Management is considering the following independent alternative courses of action in 2020 in order to maximize the return on investment for the division.
1. Reduce controllable fixed costs by 10% with no change in sales or variable costs.
2. Reduce average operating assets by 10% with no change in controllable margin.
3. Increase sales $500,000 with no change in the contribution margin percentage.
Compute the return on investment for 2019.
Answer:
The Atlantic Division of Stark Productions Company
Return on Investment = Net Income/Average operating assets x 100
1. Reduced controllable fixed costs by 10% with no change in sales or variable costs:
Net Income = $530,000 ($500,000 + 30,000)
Return on investment = $530,000/$2,500,000 x 100
= 21.2%
2. Reduced average operating assets by 10% with no change in controllable margin:
Net Income = $500,000 and average operating assets = $2,250,000
Return on Investment = $500,000/$2,250,000 x 100
= 22.22%
3. Increased sales to $4,500,000 with no change in the contribution margin percentage:
Sales $4,500,000
Variable costs 3,600,000
Contribution $900,000
Controllable fixed costs 300,000
Net operating income $600,000
Average operating assets 2,500,000
Return on Investment = $600,000/$2,500,000 x 100
= 24%
Explanation:
a) Data and Calculations:
Sales $4,000,000
Variable costs 3,200,000
Contribution $800,000
Controllable fixed costs 300,000
Net operating income $500,000
Average operating assets 2,500,000
Return on investment = Net Income/Average operating assets x 100 = $500,000/$2,500,000 x 100 = 20%
Contribution margin ratio = $800,000/$4,000,000 x 100 = 20%
The Atlantic Division's Return on Investment, as a performance measure, evaluates the efficiency of the investment in Atlantic Division. This ratio is obtained by dividing the returns or benefits of the investment by the cost of the investment, and then multiplying by 100.
What describes minerals that are deemed real property, such as gold and silver, until they are removed from the earth and become personal property?
A. Mineral rights.
B. Nutrients.
C. Synthetics.
D. Solid minerale.
Answer:
The correct answer is D
Explanation:
Solid minerals contained in the land
(Coal, iron, ore, gold or silver)
Hope this helps! （づ￣3￣）づ╭❤～
Minerals known as real property such as gold and silver are known as Solid minerale before they later become personal property.
What is a Solid minerale?These are mineral that is natural occurring in a solid and inorganic state and are representable by a chemical formula.
An example of Solid minerale includes Talc, Gold, Clay, Lithium, Kyanite, Wolframite, Gemstones etc
Therefore, the Option D is correct.
Read more about Solid minerale
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Tatham Corporation produces a single product. The standard costs for one unit of its Clan product are as follows:
Direct materials (8 pounds at $0.70 per pound) $5.60
Direct labor (2 hours at $8 per hour) 16.00
Variable manufacturing overhead
(2 hours at $7 per hour) 1,400
Total 3,560
During November Year 2, 3,500 units of Clan were produced. The costs associated with November operations were as follows:
Material purchased (35,000 pounds at $0.80 per pound) 28,000
Material used in production (31,500 pounds)
Direct labor (7,500 hours at $7.50 per hour) 56,250
Variable manufacturing overhead incurred 55,500
What is the variable overhead efficiency variance for Clan for November Year 2?
1. $3,500 favorable.
2. $3,500 unfavorable.
3. $4,000 favorable.
4. $4,000 unfavorable.
Answer:
$3,500 Unfavorable
Explanation:
The computation of variable overhead efficiency variance for Clan for November Year 2 is shown below:-
Variable overhead efficiency variance
= (Standard labor hours - actual labor hours) × (Standard variable overhead rate)
= (3,500 × 2 - 7,500) × $7
= (7,000 - 7,500) × $7
= $3,500 Unfavorable
Therefore for computing the Variable overhead efficiency variance we simply applied the above formula.
0.69 points eBookPrintReferences Check my work Check My Work button is now enabledItem 1Item 1 0.69 points Fresh Veggies, Inc. (FVI), purchases land and a warehouse for $410,000. In addition to the purchase price, FVI makes the following expenditures related to the acquisition: broker's commission, $21,000; title insurance, $1,100; and miscellaneous closing costs, $4,200. The warehouse is immediately demolished at a cost of $21,000 in anticipation of building a new warehouse. Determine the amount FVI should record as the cost of the land.
Answer:
$457,300
Explanation:
Calculation to determine the amount FVI should record as the cost of the land.
COST OF LAND
Land and warehouse $410,000
Add Expenditure:
Broker's commission $21,000
Title insurance $1,100
Miscellaneous closing costs $4,200
Warehouse demolished cost $21,000
Cost of land $457,300
Therefore the cost of land will be $457,300
Part-time workers likely result in A. inaccurately high estimates of the labor force. B. inaccurately low estimates of the labor force. C. a disincentive for the unemployed to seek employment. D. lower incomes and fewer jobs.
Answer:
Correct answer:
A. inaccurately high estimates of the labor force.
Explanation:
Part-time work is the type of work where an individual has a flexible work plan is a given company unlike the traditional full-time work. Doing such work create the impression that, there is high labour force among the various industries and sectors. For example, someone might be working in two different firms under part-time basis same day which create an impression of two different individuals.
The following financial information was summarized from the accounting records of Train Corporation for the current year ended December 31: Rails Division Locomotive Division Corporate Total Cost of goods sold $45,500 $30,500 Direct operating expenses 27,600 23,000 Sales 92,300 67,600 Interest expense $2,100 General overhead 18,900 Income tax 4,000 The income from operations for the Locomotive Division is a.$44,600 b.$67,600 c.$14,100 d.$37,100
Answer:
$14,100
Explanation:
To find the answer, we use the following formula:
Income from operations = Sales - Cost of Goods Sold - Direct Operating Expenses - General Overhead
Income from operations = $67,600 - 30,500 - 23,000
= $14,100
York's outstanding stock consists of 80,000 shares of noncumulative 7.5% preferred stock with a $5 par value and also 200,000 shares of common stock with a $1 par value. During its first four years of operation, the corporation declared and paid the following total cash dividends: 2015 total cash dividends $20,000 ; 2016 total cash dividends 28,000 ; 2017 total cash dividends 200,000 ; 2018 total cash dividends 350,000. Please explain how to journal this.
Answer:
dividends paid during 2015:
preferred stock dividends = $20,000, dividend per preferred stock = $0.25
common stock dividends = $0, dividend per common stock = $0
dividends paid during 2016:
preferred stock dividends = $28,000, dividend per preferred stock = $0.35
common stock dividends = $0, dividend per common stock = $0
dividends paid during 2017:
preferred stock dividends = $30,000, dividend per preferred stock = $0.375
common stock dividends = $170,000, dividend per common stock = $0.85
dividends paid during 2018:
preferred stock dividends = $30,000, dividend per preferred stock = $0.375
common stock dividends = $320,000, dividend per common stock = $1.60
Since the preferred stocks are not cumulative, any preferred dividends that are not paid during a year will not be paid in future years.
"A retired customer that has a portfolio of blue chip stocks is looking to supplement his retirement income. An appropriate recommendation would be to:"
Answer: sell covered calls
Explanation:
A retired customer that has a portfolio of blue chip stocks is looking to supplement his retirement income. An appropriate recommendation would be to sell covered calls.
It should be noted that a covered call is a financial transaction that takes place when a call option is sold by an investor even though the investor still owns part of the security based on what's sold.
fremont which uses the high-low method reported total cost of $10 per unit its lowest production level, 5000 units. when production tripled to its highest level, the total cost per unit dropped to $5 variable cost per unit
Answer:
$2.50
Explanation:
Calculation for the estimation of variable cost per unit
Units Total cost
High method 15,000×$5 per units =$75,000
(5,000*3)=15,000
Low method 5,000*$10 per units=$50,000
Difference 10,000 $25,000
Variable cost per unit =$25,000/10,000
Variable cost per unit=$2.50
Note: Based on the information given we were told that production tripled to its highest level which means the high method units will be 15,000 units (5,000 units*3)
Therefore Fremont would estimate its variable cost per unit as: $2.50
2. The world has now become a “global village” in many respects. a) Explain any 5 factors working to make the world “a global village” for businesses. b) Discuss 4 major reasons why businesses go global.
Answer:
the watch has been totally fed tractors working to make a words a Glover villa for measures reserve between two globin respect as a global wind I have been by practice and a business discuss and white business as a work of the word for
Lacy Technology transferred items with $12,600 of cost out of the Assembly Department because the items were finished and ready to be sold. What journal entries correctly reflects this transaction?
Answer:
Dr Finished Goods Inventory 12,600
Cr Work in Process - Assembly 12,600
Explanation:
Based on the information given we were told that the company transferred items that cost the amount of $12,600 from the Assembly Department because the items were finished and ready to be sold which means that the journal entries will be recorded as:
Dr Finished Goods Inventory 12,600
Cr Work in Process - Assembly 12,600
ane is planning to offer a Groupon for inner tube rentals that she will distribute on hot, sunny, summer days by the river that runs through her town. Based on her past experience with Groupon, she has assigned the following probability distribution to the number of tubes she will rent on a randomly selected day. If Jane would like her expected revenue to be at least $300 per day, what should the Groupon price be? (Round your answer up to the nearest whole dollar amount.)
Probability assigned:|
x 30 60 120 180
P(x) .10 .40 .40 .10
Answer:
Jane
Price of Groupon for a revenue of $300 is:
$3
Explanation:
a) Data and Calculations:
Expected Sales volume:
Number of Tubes x 30 60 120 180
Probability P(x) .10 .40 .40 .10
Expected values 3 24 48 18
Total = 93 tubes
Groupon price = $300/93 = $3.23
b) Jane's price for each Groupon will be the rent revenue per day divided by the expected number of tubes to rent daily. The expected number of tubes is derived by multiplying each expected number of tubes by its probability and then summing up the results.
The market for hot dogs on the streets of New York City can be considered close to a perfectly competitive market. Because there are so many individuals buying and selling hot dogs:
Question:
The market for hot dogs on the streets of New York City can be considered close to a perfectly competitive market. Because there are so many individuals buying and selling hot dogs:
A) there is a shortage of hot dogs
B) there is a surplus of hot dogs
C) market forces set the price in the market
D) firms are able to make large economic profits
E) firms cannot make positive accounting profits
Answer:
The correct answer is C.
Explanation:
Perfect competition is a market/ industry situation where there are numerous companies producing similar or perfect substitute products. Also, in the same market, none of the players is large enough to single-handedly influence the market especially with respect to price.
Cheers!
Alpha Industries is considering a project with an initial cost of $9.1 million. The project will produce cash inflows of $1.84 million per year for 7 years. The project has the same risk as the firm. The firm has a pretax cost of debt of 5.94 percent and a cost of equity of 11.49 percent. The debt–equity ratio is .71 and the tax rate is 40 percent. What is the net present value of the project?
Answer:
NPV = $1.22 million
Explanation:
The Net present value (NPV) is the difference between the Present value (PV) of cash inflows and the PV of cash outflows. A positive NPV implies a good investment decision and a negative figure implies the opposite.
NPV of an investment:
NPV = PV of Cash inflows - PV of cash outflow
To work oit the NPV we would need to determine the discount rate i.e cost of capital as follows:
Cost of capital -discount rate -
WACC = We×Ke + Wd×Kd
After cost o debt = 5.94× (1-0.4)=3.56
WACC = (0.71×3.56 %) + (0.29×11.49%)=5.86 %
PV of cash inflow = A× (1- (1+r)^(-n))/r
A- annul cash inflow, r- 5.86%, n- 7
PV of cash inflow= 1.84 million × (1- 1.0586^(-7))/0.0586 =10.32
Initial cost = 9.1 million
NPV = 10.32 - 9.1 = 1.22 million
NPV = $1.22 million
________ means that service quality depends on the quality of buyer-seller interaction during the service encounter.
Answer: interactive marketing
Explanation:
Interactive marketing is also referred to as event-driven marketing or trigger based marketing and it simply has to do with using an effective communication which is two-ways to enable the consumers connect directly with a company.
Interactive marketing means service quality depends on the quality of buyer-seller interaction during the service encounter.
The net income reported on the income statement for the current year was $121,900. Depreciation recorded on store equipment for the year amounted to $20,100. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $48,030 $44,190 Accounts receivable (net) 34,440 32,660 Merchandise inventory 47,020 49,710 Prepaid expenses 5,280 4,200 Accounts payable (merchandise creditors) 45,000 41,800 Wages payable 24,590 27,310 a. Prepare the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from operating activities: $ Adjustments to reconcile net income to net cash flow from operating activities: Changes in current operating assets and liabilities: Net cash flow from operating activities $ b. Cash flows from operating activities differs from net income because it does not use the of accounting. For example revenues are recorded on the income statement when .
Answer:
See answers below.
Explanation:
In order to get net cash flow through indirect method, we will have to make adjustment to the net income; hence we get the increase or decrease of different accounts with the data balance.
a) End beginning cash $48,030 $44,190
Increase in cash $3,840
Accounts receivable(net) $34,440 $32,660
Increase in accounts receivable $1,780
Merchandise Inventory $47,020 $49,710
Decreased inventory -$2,690
Prepaid expenses $5,280 $4,200
Increase prepaid expenses $1,080
Accounts payable(Merchandise creditors) $45,000 $41,800
Accounts payable increase $3,200
Wages payable $24,590 $27,310
Decreased wages payable -$2,720
Per below, we have some accounts that are added (+) to the net income while some are also deducted (-).
Net income $121,900
Adjustment to reconcile the net income to cash
+ Depreciation $20,100
+ Increase in cash $3,840
- Increase in accounts receivable ($1,780)
+ Inventory decrease $2,690
- Increase prepaid expenses ($1,080)
+ Accounts payable increase $3,200
- Decreased wages payable ($2,720)
Net cash $146,150
b) Briefly explain why net cash flow from operating activities is different other than net income.
The reason is that while net income refers to the earned profit by a company for a period ; cash flow from operating activities are measurement of daily cash (in and out) expended on business operation. Cash flow give explanation on the use of cash in an organization on a daily basis which includes net income from the income statement, changes in working capital, adjustments to net profits etc. t is to be noted that the starting point of calculating cash flow from operating activities is the net income.
