Use the Table for the Question(s)below

question 34

Multiple Choice

Use the table for the question(s) below.
AOS Industries Statement of Cash Flows for 2008
-Consider the above statement of cash flows.In 2008,AOS Industries had contemplated buying a new warehouse for $2 million,the cost of which would be depreciated over 10 years.If AOS Industries has a tax rate of 25%,what would be the impact for the amount of cash held by AOS at the end of the 2008?

• A)It would have $2,000,000 less cash at the end of 2008.
• B)It would have $1,950,000 less cash at the end of 2008.
• C)it would have $150,000 less cash at the end of 2008.
• D)it would have an additional $50,000 in cash at the end of 2008.

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Definitions:

Equal Distribution

The concept of ensuring that resources, wealth, or opportunities are evenly distributed among all members of society.

Resource Allocation

The process of distributing available resources among various competing needs and wants.

Laissez-Faire

An economic philosophy of free-market capitalism that opposes government intervention.

Circular Flow

A model in economics that illustrates how money moves through an economy between producers and consumers, highlighting the interdependencies of different economic sectors.