At the Beginning of the Year,Malek Farm's Had Long-Term Debt

question 53

Multiple Choice

At the beginning of the year,Malek Farm's had long-term debt of $687 and total debt of $911.At the end of the year,the long-term debt is $579 and total debt is $898.If $58 of interest was paid during the year,what is the cash flow to the creditors?

• A)-$50
• B)-$166
• C)$71
• D)$166
• E)$50

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Definitions:

Current Asset

A current asset is any asset likely to be converted into cash within a year during the normal course of a business.

Units-Of-Output Method

A depreciation method where the expense is based on the number of units produced or the machine's hours used, reflecting actual usage.

Depreciation

The systematic allocation of the cost of a tangible asset over its useful life, reflecting the loss in value over time.

Residual Value

Residual value refers to the predicted value of an asset at the conclusion of its lifespan.