Which of the Following Adjustments Is Not Correct If You

question 64

Multiple Choice

Which of the following adjustments is not correct if you are trying to calculate cash flow from financing activities?

• A) Add dividends paid
• B) Add any increase in long term borrowing
• C) Add any increase in short-term borrowing
• D) Add proceeds from the sale of stock

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Definitions:

Underapplied

A situation in cost accounting where the allocated overhead costs are less than the actual overhead costs.

Predetermined Overhead Rate

The predetermined overhead rate is a rate used to allocate manufacturing overhead costs to products or job orders, based on estimated overhead costs and activity levels.

Variable Overhead Rate Variance

The difference between the actual variable overhead costs incurred and the standard cost allocated, indicating inefficiencies or cost control issues.

Favorable

A term used in accounting to describe a situation where actual costs are less than the budgeted or standard costs.