Rodriguez Inc $\quad$ $\quad$ $\quad$ $\quad$ $\quad$

question 97

Multiple Choice

Rodriguez Inc. uses the indirect method to prepare its statement of cash flows. Refer to the following portion of the comparative balance sheet: $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ Rodriguez Inc.
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ Comparative Balance Sheet
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ December 31, 2014 and 2013
$\begin{array}{lrrc}\hline&2014&2013& \text { Increase/decrease } \\ \text { Cash } & \$ 21,000 & \$ 18,000 & \$ 3,000 \\\text { Accounts Receivable } & 31,000 & 35,000 & (4,000) \\\text { Inventory } & 53,000 & 25,000 & 28,000 \\\text { Plant and Equipment } & 123,000 & 90,000 & 33,000 \\\text { Accumulated Depreciation-Plant and Equipment } & (43,000) & (40,000) & (3,000) \\ \text { Total assets } & \$ 228,000 & \$ 168,000 & \$ 60,000 \\\hline\end{array}$ Additional information provided by the company includes the following:
1) Equipment costing $65,000 was purchased for cash.
"2) Equipment with a cost of $32,000 and accumulated depreciation of $7,000 was sold for $45,000.
What was the amount of net cash provided by (used for) investing activities?"

• A) $120,000
• B) $20,000
• C) $(120,000)
• D) $(20,000)

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Definitions:

Perfectly Competitive

A perfectly competitive market is one with many buyers and sellers, where no single entity can influence the market price, and all products are identical.

Profit-Maximizing

A strategy or approach focused on increasing a firm’s profits to the highest possible level given its production costs and market demand.

Downward-Sloping

A characteristic of demand curves where price and quantity demanded move in opposite directions.

ATC Curve

A graphical representation of the average total cost of producing various quantities of output, showing how unit costs change with changes in output level.