Parmesan Company Uses the Direct Method for Its Statement of Cash

question 56

Multiple Choice

Parmesan Company uses the direct method for its statement of cash flow. It reports the following information regarding the year 2014: From the income statement:
Sales Revenues, $265,000
Cost of Goods Sold, $210,000
Operating expenses, $31,000
From the balance sheet: On the statement of cash flows, what amount will be shown for payments to suppliers for operating expenses? (Assume that Accounts Payable are for purchases of inventory only and Accrued Liabilities relate to Operating Expenses.)

• A)$33,500
• B)$28,500
• C)$29,500
• D)$35,000

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Definitions:

P Chart

A type of control chart used for monitoring the proportion of defective items in a process over time.

Control Charts

Graphical tools used to determine if a manufacturing or business process is in a state of statistical control.

Sample Proportion

The ratio or fraction of sample observations that belong to a certain category or that exhibit a particular attribute or characteristic.

Centerline

In statistical process control, the central value around which data points fluctuate, often representing the process average.