Francis Company Had Operating Expenses of $20,000 and Depreciation Expenses

question 19

Multiple Choice

Francis Company had operating expenses of $20,000 and depreciation expenses of $4,000.Assuming no other transactions,what was the cash paid for operating expenses?

• A)$24,000
• B)$22,000
• C)$16,000
• D)$20,400
• E)$23,000

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Definitions:

Specific Identification

A method of inventory costing that identifies and assigns the actual cost to each individual item of inventory.

High-cost Items

Products or services that have a significant purchase price or maintenance cost.

Periodic Inventory System

An inventory system where inventory levels and the cost of goods sold are updated in the accounting records periodically, often at the end of an accounting period.

Gross Profit Method

An accounting technique used to estimate the amount of inventory a company has by using the gross margin percentage.