If the Price of Bubble Gum Changed in the Market

question 275

Multiple Choice

If the price of bubble gum changed in the market from 1 cent to 1.5 cents and Joe's Market didn't change the price it charges for the bubble gum, this behavior is likely due to

• A)discretionary policy.
• B)economic laziness.
• C)large menu costs.
• D)small menu costs.

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Definitions:

Previously Unissued Shares

Shares that are authorized by a corporation's charter but have not been issued or sold to investors.

Consolidated Statement of Cash Flows

A financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, including the cash flows of the parent company and its subsidiaries.

Decrease in Accounts Payable

A situation where the total amount owed by a company to its suppliers or creditors decreases during a specific period.

Indirect Method

A way of reporting cash flows from operating activities in the cash flow statement, starting with net income and adjusting for changes in balance sheet accounts.