Wellington Inc

question 71

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:
-On Wellington's statement of cash flows,using the direct method,what amount will be shown for payments to employees? (Assume Accrued Liabilities relate to Other Operating Expense.)

• A)$74,000
• B)$45,000
• C)$25,000
• D)$49,000

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Definitions:

Diminishing Returns

A principle stating that if one factor of production is increased while others are held constant, the overall returns will eventually decrease after a certain point.

Marginal Product

The additional output that results from using one more unit of a particular input, while holding other inputs constant.

Average Product

The output obtained by dividing the total product by the number of units of the variable input used in production, ideally reflecting productivity per input unit.

Total Product

The total output or quantity of goods produced by a firm or economy at a given level of input.