Accounts Receivable from Sales to Customers Amounted to $40,000 and $32,000

question 18

Multiple Choice

Accounts receivable from sales to customers amounted to $40,000 and $32,000 at the beginning and end of the year, respectively. Income reported on the income statement for the year was $110,000. Exclusive of the effect of other adjustments, the net cash flows from operating activities to be reported on the statement of cash flows using the indirect method is

• A) $118,000
• B) $110,000
• C) $102,000
• D) $150,000

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Definitions:

Process Cost Systems

A method in accounting used to track the costs associated with producing products in continuous processes.

Cost Data

Information related to the cost of goods or services, including production, labor, and materials costs.

Job Order

A custom or special order detailing the work to be performed or products to be produced.

Process Costing System

An accounting method used when identical or similar products are mass-produced, allocating costs based on process departments.