Wessen Company Reports Net Income of $200,000 for the Year

question 42

Multiple Choice

Wessen Company reports net income of $200,000 for the year ended December 31,2013.It also reports $40,000 depreciation expense,$22,500 amortization expense,and a $15,000 loss on the sale of machinery.Its comparative balance sheets reveal a $225,700 increase in accounts receivable,$31,600 decrease in accounts payable,$15,000 decrease in prepaid expenses,and $48,100 decrease in wages payable.What net cash flows are provided (used) by operating activities using the indirect method?

• A)($12,900)
• B)$57,900
• C)$50,400
• D)($57,900)
• E)($50,400)

Analyze special order decisions and the relevance of differential analysis in managerial decision-making.

Apply the total cost method of cost-plus pricing to determine product prices.

Calculate profit goals as a return on invested assets and understand its impact on pricing strategies.

Understand and apply the markup percentage concept in cost-plus pricing.

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Definitions:

Mercantilism

An economic theory and practice that promotes government regulation of the nation's economy to increase state power at the expense of rival national powers.

Trade Surplus

A situation where a country's exports exceed its imports over a given period.

Sovereign Country

An independent state that possesses full self-government and is not controlled by another state.

Porter's Diamond Model

A framework for analyzing the competitive advantage nations or regions possess due to four key factors: factor conditions, demand conditions, related and supporting industries, and firm strategy, structure, and rivalry.