Managers at Sprocket Inc

question 30

Multiple Choice

Managers at Sprocket Inc.have recognized declining sales on their ABC model product and must make a decision about what to do.Their next step is to

• A) define the situation.
• B) develop options.
• C) analyze options.
• D) select the best option.
• E) implement the decision.

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Definitions:

Operating Activity

Activities that relate directly to the business’s primary operations, such as selling goods and providing services, not including investing or financing activities.

Direct Method

A way of preparing the cash flow statement where actual cash flows from operating activities are listed, opposed to adjusting net income for indirect factors.

Net Cash Flows

The total amount of cash and cash-equivalents being transferred into and out of a business.

Operating Activities

Transactions and events that affect the net income, related to the core business operations of a company.