Leduc Co Reported Sales of $350,000 and Total Expenses of $280,000;

question 32

Multiple Choice

Leduc Co. reported sales of $350,000 and total expenses of $280,000; wages payable increased by $12,000; inventory decreased by $25,000; accounts payable decreased by $50,000; and depreciation was $30,000. What was the net cash flow from operating activities?

• A) $87,000
• B) $40,000
• C) $15,000
• D) $63,000

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Definitions:

Unearned Rent Revenue

Income received by a company for rent that has been paid in advance by tenants but not yet earned, considered a liability until the rental period occurs.

Liabilities

Financial obligations or debts that a company owes to external parties, which must be settled over time through the transfer of assets, provision of services, or other forms of economic benefit.

Revenue

The cumulative revenue produced from the sale of goods or provision of services directly linked to the main business activities of a company.

Unearned Rent Revenue

Income received by a property owner for rent that has not yet been earned because the time period the rent covers has not yet passed.