On a Statement of Cash Flows Prepared Using the Direct

question 121

Multiple Choice

On a statement of cash flows prepared using the direct method,cash received from selling merchandise is considered a ________.

• A) cash inflow from investing activities
• B) cash inflow from operating activities
• C) cash outflow from financing activities
• D) cash outflow from investing activities

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Definitions:

Price Level

The overall level of prices of goods and services in an economy at a given time, often measured by a price index.

Nominal Interest Rate

The stated rate of interest on a financial instrument, not accounting for the compounding effect or inflation.

Inflation Rate

The elevation in the percentage cost of goods and services across an economy over an established period.

Relative-price Variability

Fluctuations in the price of one good or service in relation to others, affecting purchasing decisions and economic equilibrium.