Jarvis, Inc What Is the Amount of Cash Used by Financing Activities

question 53

Multiple Choice

Jarvis, Inc. reported net income of $44,000 for the year ended December 31, 2015. Included in net income was a gain on early extinguishment of debt of $60,000 related to bonds payable with a book value of $1,200,000. Each of the following accounts increased during 2015: $$\begin{array} { l l } \text { Notes receivable } & \$ 45,000 \\\text { Deferred tax liability } & \$ 10,000 \\\text { Treasury stock } & \$ 120,000\end{array}$$ What is the amount of cash used by financing activities for Jarvis, Inc. for the year ended December 31, 2015?

• A) $1,260,000
• B) $1,270,000
• C) $1,900,000
• D) $ 225,000

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Definitions:

Seniority-based Pay

is a compensation system where employees' salaries increase with the length of their service to the organization.

Turnover

The rate at which employees leave a workforce and are replaced by new personnel.

Self-determination

Self-determination is the process by which individuals control their own life, make their own decisions, and pursue their own goals independently.

Initiate Work

The act of starting or setting in motion tasks or activities that contribute to achieving objectives.