Avatar Company Uses the Indirect Method to Prepare Its Cash

question 9

Multiple Choice

Avatar Company uses the indirect method to prepare its cash flow statement.Refer to the following information for the year 2016: Net cash provided by operating activities: $110,000
Net cash used in investing activities: $(116,500)
Net cash provided by financing activities: $19,000
If the cash balance at the beginning of the year was $13,300,what would be the ending cash balance?

• A)$12,500
• B)$6500
• C)$13,300
• D)$25,800

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Definitions:

High-Quality Goods

High-quality goods are products that meet or exceed customer expectations in terms of performance, durability, and satisfaction, often associated with higher standards of production and materials.

Product Quality

The characteristics and features of a product or service that bears on its ability to satisfy stated or implied needs.

Market Signaling

Process by which sellers send signals to buyers conveying information about product quality.

Asymmetric Information

A situation in which one party in a transaction has more or better information than the other, often leading to an imbalance in power and potentially unfair outcomes.