If Net Cash Flows from Operating Activities Total $104,000,purchases of Plant

question 35

Multiple Choice

If net cash flows from operating activities total $104,000,purchases of plant assets total $30,000,dividends total $12,000,and sales of plant assets total $17,000,the free cash flow equals

• A) $79,000.
• B) $163,000.
• C) $105,000.
• D) $45,000.

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Definitions:

Unit Product Cost

The total expense incurred to manufacture or produce one unit of a product, including direct materials, labor, and overhead costs.

Variable Manufacturing Overhead

These are costs that vary with production volume, such as utilities for the production plant or materials.

Net Operating Income

The total revenue from operations minus the operating expenses, exclusive of taxes and interest, in a different phrasing.

Variable Manufacturing Overhead

Costs of manufacturing that vary directly with the level of production, such as utilities for the manufacturing plant.