Farmer's Corp

question 68

Multiple Choice

Farmer's Corp. has the following items that the controller is uncertain of where to place on the statement of cash flows: Using the indirect method, how much would appear in the Operating Activities section?

• A)$305,000
• B) ($55,000)
• C) ($46,000)
• D) $116,000

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Definitions:

Marginal Utility

The incremental utility or happiness a consumer derives from acquiring and using an additional unit of a good or service.

Utility Per Dollar

A measure of the satisfaction or usefulness obtained from purchasing goods or services relative to the amount of money spent.

Diminishing Marginal Utility

The principle stating that as more of a good or service is consumed, the marginal benefit of additional units will decline.

Utility Maximization

The process by which consumers adjust their consumption to achieve the highest level of satisfaction from their available resources.