Mid-Town Auto Parts Company Uses the Direct Method to Prepare

question 70

Multiple Choice

Mid-Town Auto Parts Company uses the direct method to prepare its statement of cash flows. Refer to the following information reported for 2019:
1) Sales Revenue, $519,000
2) Accounts Receivable, beginning balance, $97,000
3) Accounts Receivable, ending balance, $65,000
Compute the collections from customers.

• A) $551,000
• B) $454,000
• C) $162,000
• D) $357,000

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Definitions:

Observed Frequencies

The actual number of occurrences or instances of a variable category observed in a statistical sample.

Chi-squared Goodness-of-fit Test

A statistical test used to determine if observed data fits a theoretical distribution.

Rule of Five

A statistical rule of thumb asserting that if a sample size is large enough (n>30), the sample means will be normally distributed.

Chi-squared Goodness-of-fit Test

A statistical test used to determine how well an observed distribution fits an expected distribution across different categories.