When a Company Makes the Statement "Wherever There Is a Cash

question 46

Multiple Choice

When a company makes the statement "wherever there is a cash transaction" as its distribution policy, they are emphasizing a(n)

• A) intensive distribution.
• B) maximum distribution.
• C) blanket distribution.
• D) selective distribution.
• E) exclusive distribution.

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Definitions:

Operating Activities

Transactions and events that relate to the core business functions, such as receipts from sales of goods and services, payments to suppliers, and salaries to employees.

Depreciable Asset

A type of asset that loses value over time due to wear and tear, decay, or obsolescence, which can be accounted for through depreciation.

Indirect Method

A method of preparing the cash flow statement in which net income is adjusted for non-cash transactions and changes in working capital.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenue.