Westmoreland Company
Following Are Selected Data from Westmoreland Company's Financial

question 142

Multiple Choice

Westmoreland Company
Following are selected data from Westmoreland Company's financial statements.
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$\begin{array}{lrr}&2018&2017\\\text { Current liabilities } & \$ 230,000 & \$ 160,000 \\\text { Long-term debt } & 120,000 & 320,000 \\\text { Stockhol ders' equity } & 420,000 & 540,000 \\\text { Cash payments for additions to plant and equipment } & 45,000 & 32,000 \\\text { Net cash flow from operating activities } & 80,000 & 51,000 \\\text { Interest and principal payments } & 12,000 & 8,000 \\\text { Net operating cash flows before interest and taxes } & 68,000 & 43,000 \\\text { Net income } & 90,000 & 72,000 \\\text { Interest expense } & 8,500 & 11,500 \\\text { Income taxes } & 16,000 & 14,500 \\\text { Dividends paid } & 15,000 & 30,000\end{array}$ ​
-Refer to the Westmoreland Company data.
The cash flow from operations to capital expenditures ratio for 2018 is an indicator that Westmoreland Company

• A)has been effectively able to use operations to finance its acquisitions of productive assets.
• B)has increased profits by $13,000.
• C)has decreased cash,but is offset by the increase in net income.
• D)has net income that is more than it would have been had dividends of $30,000 been paid.

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Definitions:

Psychological Contract

The unwritten, implicit agreement between an employee and employer outlining mutual expectations, including job responsibilities and benefits.

Self-Directed Teams

Groups in which members work collaboratively on tasks with little to no supervision, often leading and managing themselves.

Enlarged

Increased in size, scope, or scale.

Enriched

Improved or enhanced in quality, value, or complexity, often used in the context of job design to refer to making work more rewarding and engaging for employees.