Avatar Company Uses the Direct Method to Prepare Its Statement

question 132

Multiple Choice

Avatar Company uses the direct method to prepare its statement of cash flows. Please refer to the following information reported for the year 2014: What amount was paid to suppliers for inventory purchases on a cash basis?

• A)$140,000
• B)$136,000
• C)$80,000
• D)$82,000

Grasp the process of preparing and understanding the components of a classified balance sheet.

Comprehend the concept and necessity of reversing entries in accounting.

Recognize the various steps in the accounting cycle, including journalizing and posting closing entries.

Understand the concept of the operating cycle and its importance to a company’s cash flow.

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Definitions:

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