In 20X2, the W D Company Reported the Following Increases

question 138

Essay

In 20X2, The W D Company reported the following increases or decreases in current assets and current liabilities. Identify whether each of these increases or decreases caused cash to increase or decrease. Show increases with a (+) in front of the amount and decreases with a (-) in front of the amount in the column labelled cash effect. $$\begin{array} { | l | l | l | } \hline \text { Changes in current assets and liabilities } &\\\hline \text { Account } & \text { Account Balance Change } & \text { Cash Effect } ( + / - ) \\\hline \text { Receivables - CA } & \text { Decrease \$366 } & 1 . \\\hline \text { Inventories - CA } & \text { Decrease \$103 } & 2 . \\\hline \text { Film and television costs - CA } & \text { Increase \$848 } & 3 . \\\hline \text { Trade payables - CL } & \text { Decrease \$179 } &4 . \\\hline \text { Current portion of borrowings - CL } & \text { Increase \$292 } & 5 . \\\hline \text { Unearned royalties - CL } & \text { Increase \$69 }&6. \\\hline\end{array}$$

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Definitions:

Manual Labor

Work performed by hand or with basic tools rather than machinery, often requiring physical effort.

Days Payable Outstanding

A financial metric that measures the average number of days a company takes to pay its invoices and bills to its suppliers and creditors.

Goats Grazing

The use of goats as a natural method to control underbrush and manage land, promoting ecological health.

Pricing

The process of determining the cost of a product or service to the consumer, taking into account factors such as production costs, market demand, and competitive pricing strategies.