Scott Limited Had a Net Profit After Tax of $650,000

question 16

Multiple Choice

Scott Limited had a net profit after tax of $650,000 for the financial year. Included in this profit was: Depreciation expense $80 000
Gain on sale of investments $30 000
Decrease in inventories $15 000
Increase in Accounts receivable $35 000
The cash flow from operating activities during the year was:

• A) $580,000.
• B) $620,000.
• C) $680,000.
• D) $720,000.

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Definitions:

MRP

Material Requirements Planning (MRP) is a system for planning production, scheduling activities, and controlling inventory used in overseeing manufacturing operations.

MPP

Marginal Physical Product, the additional output resulting from the use of one more unit of a variable input, holding all other inputs constant.

MRP

Marginal Revenue Product; the additional revenue generated from employing one more unit of a resource or factor of production.

Substitution Effect

The change in demand for a good or service that occurs when its price increases or decreases, leading consumers to substitute it with other goods or services that are relatively more or less expensive.