A Security Analyst Obtained the Following Information from Prestopino Products

question 45

Multiple Choice

A security analyst obtained the following information from Prestopino Products' financial statements:- Retained earnings at the end of 2011 were $700,000,but retained earnings at the end of 2012 had declined to $320,000.- The company does not pay dividends.- The company's depreciation expense is its only non-cash expense; it has no amortizationcharges.- The company has no non-cash revenues.- The company's net cash flow (NCF) for 2012 was $150,000.On the basis of this information,which of the following statements is correct?

• A)Prestopino had negative net income in 2012.
• B)Prestopino's depreciation expense in 2012 was less than $150,000.
• C)Prestopino had positive net income in 2012, but its income was less than its 2011 income.
• D)Prestopino's NCF in 2012 must be higher than its NCF in 2011.

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Definitions:

Type B Personality

A personality type characterized by a relaxed, patient, and easy-going nature, in contrast to the more intense and deadline-oriented Type A personality.

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Physical activity that relies on the oxygen to generate energy, improving cardiovascular conditioning.

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The average period that an individual is expected to live as determined by statistical analysis, often influenced by factors such as genetics, lifestyle, and healthcare quality.