Which of the Following Operating Activities Results in a Cash

question 46

Multiple Choice

Which of the following operating activities results in a cash outflow?

• A) Paying creditors for inventory
• B) Collecting accounts receivable
• C) Making cash sales
• D) Receiving deposits recorded as unearned revenue

---

Definitions:

Production Budget

An estimate of the total output, costs, and resources required for production within a specific period to meet forecasted demand.

Cash Receipts

Cash inflows or money received by a business from various sources, including sales, investments, and financing activities.

Budgeted

The process of creating a plan to spend your money over a certain period.

Expected Unit Sales

The number of units of product a business anticipates selling over a specific period, based on forecasts.