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Wellington Inc -On Wellington's Statement of Cash Flows, Using the Direct Method

question 44

Multiple Choice

Wellington Inc. uses the direct method to prepare its statement of cash flows. Refer to the following financial statement information for the year ended December 31, 2015: $Wellington Inc. uses the direct method to prepare its statement of cash flows. Refer to the following financial statement information for the year ended December 31, 2015: \begin{array} { l r r } \text { Sales Revenue } & \$ 291,300 \\ \text { Interest Revenue } & 1,000 \\ \text { Gain on Sale of Plant Assets } & 6,000 \\ \text { Total Revenues and Gains } && \$ 298,300 \\ \text { Cost of Goods Sold } & 145,000 \\ \text { Salaries and Wages Expense } & 49,000 \\ \text { Depreciation Expense-Plant Assets } & 16,000 \\ \text { Other Operating Expense } &25,000 \\ \text { Interest Expense } &3,500 \\ \text { Income Tax Expense } & \underline{7,800}& \\ \text { Total Expenses } & &\underline{ 246,300} \\ \text { Net Income } & &\underline{\$ 52,000} \\ \hline \end{array} -On Wellington's statement of cash flows, using the direct method, what amount will be shown for payments to suppliers for Inventory and other Operating Expenses? Assume Accrued Liabilities relate to Other Operating Expense. A) $197,000 B) $176,000 C) $21,000 D) $200,000$ $\begin{array} { l r r } \text { Sales Revenue } & \$ 291,300 \\\text { Interest Revenue } & 1,000 \\\text { Gain on Sale of Plant Assets } & 6,000 \\\text { Total Revenues and Gains } && \$ 298,300 \\\text { Cost of Goods Sold } & 145,000 \\\text { Salaries and Wages Expense } & 49,000 \\\text { Depreciation Expense-Plant Assets } & 16,000 \\\text { Other Operating Expense } &25,000 \\\text { Interest Expense } &3,500 \\\text { Income Tax Expense } & \underline{7,800}& \\\text { Total Expenses } & &\underline{ 246,300} \\\text { Net Income } & &\underline{\$ 52,000} \\\hline\end{array}$
-On Wellington's statement of cash flows, using the direct method, what amount will be shown for payments to suppliers for Inventory and other Operating Expenses? Assume Accrued Liabilities relate to Other Operating Expense.

Definitions:

Nonreactive

A term used to describe a situation, measurement, or test that does not alter the behavior or response of the subject being observed.

Timid

Showing a lack of courage or confidence; easily frightened.

Prejudice

Preconceived opinion that is not based on reason or actual experience; bias or discrimination against an individual or group.

Discrimination

Unjust or prejudicial treatment of different categories of people, especially on the grounds of race, age, or sex.