Zack CoReported a Net Loss of $50,000 for 2016, Yet Its

question 158

Multiple Choice

Zack Co.reported a net loss of $50,000 for 2016, yet its cash balance increased during the year.Which financial statement should Zack's management refer to for an explanation of this situation?

• A) Balance sheet
• B) Income statement
• C) Statement of Retained Earnings
• D) Statement of Cash Flows

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Definitions:

Appeals to Tradition

Arguments that justify a practice or belief based on its historical continuity or long-standing usage.

Egocentric Bias

Egocentric bias is the tendency for people to rely excessively on their own perspective and/or have a higher regard for their own attributes or abilities when analyzing situations or making decisions.

Illusory Correlation

A cognitive bias where a relationship between two variables is perceived despite no such association existing.

False Cause

Refers to a logical fallacy where it is assumed that because one event follows another, the first event caused the second.