A Company's Income Statement for the Year Shows a Net

question 90

Multiple Choice

A company's income statement for the year shows a net loss of $90,000. Additional information for the year follows: What is the net cash flows from operating activities?

• A) ($99,000)
• B) $27,000
• C) $13,000
• D) ($45,000)

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Definitions:

Disposable Income

The amount of money individuals or households have available for spending and saving after income taxes have been deducted.

Consumption

The use of goods and services by households that leads to a decrease in their availability.

Disposable Income

Available financial merits for households towards spending and saving following income tax subtractions.

MPC

Marginal Propensity to Consume, which is the proportion of any additional income that is spent on consumption rather than being saved.