Lager Company Has Other Operating Expenses of $260000

question 18

Multiple Choice

Lager Company has other operating expenses of $260000. There has been an increase in prepaid expenses of $20000 during the year and accrued liabilities are $15000 lower than in the prior period. Using the direct method of reporting cash flows from operating activities what were Lager's cash payments for operating expenses?

• A) $255000
• B) $265000
• C) $225000
• D) $295000

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Definitions:

Manufacturing Overhead

All indirect costs associated with the production process, such as utilities, maintenance, and factory management salaries.

Raw Materials Transactions

Raw materials transactions involve the recording and tracking of purchases, usage, and inventory levels of raw materials in a manufacturing or production process.

November

The month that comes after October and before December in the Gregorian calendar, known as the eleventh month.

Manufacturing Overhead Costs

Expenses related to the manufacturing process that are not directly tied to the production of individual items, such as factory rent, utilities, and salaries of maintenance staff.