Operating Expenses Other Than Depreciation Expense for the Year Were

question 78

Multiple Choice

Operating expenses other than depreciation expense for the year were $30,500. Prepaid expenses increased by $9,400. Cash payments for operating expenses to be reported on the cash flow statement using the direct method would be:

• A) $39,900.
• B) $9,400.
• C) $30,500.
• D) $21,100.

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Definitions:

FIFO

"First In, First Out," a method used in inventory management and accounting where the goods first added to inventory are the first to be sold.

Inventory Cost Formula

The method used to determine the cost of goods available for sale or the cost of goods sold, such as FIFO (First-In, First-Out), LIFO (Last-In, First-Out), or Average Cost.

Prior Writedown

A reduction in the book value of an asset when its market value falls below its current book value, previously accounted for in financial statements.