For Each of the Following Separate Cases,use the Information Provided

question 140

Essay

For each of the following separate cases,use the information provided to calculate the missing cash inflow or cash outflow:
(a)
$\begin{array}{|l|r|}\hline \text { Accounts receivable balances: } & \\\hline \text { Beginning of year } & \$ 60,000 \\\hline \text { End of year } & 57,000 \\\hline \text { Sales revenue (all on credit) } & 375,000 \\\hline \text { Cash received from customers } & \$ \\\hline\end{array}$

(b)
$\begin{array}{|l|r|}\hline \text { Accounts payable balances: } & \\\hline \text { Beginning of year } & \$ 42,000 \\\hline \text { End of year } & 45,000 \\\hline \text { Merchandise inventory balances: } & \\\hline \text { Beginning of year } & 50,000\\\hline \text { End of year } & 47,500\\ \hline \text { Cost of goods sold } & 250,000\\\hline \text { Cash paid for merchandise inventory } & \$ \\\hline\end{array}$
(c)
$\begin{array}{|l|r|}\hline \text { Interest payable balances: } & \\\hline \text { Beginning of year } & \$ 7,500 \\\hline \text { End of year } & 9,200 \\\hline \text { Interest expense } & 35,000 \\\hline \text { Cash paid for interest } & \$ \\\hline\end{array}$

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Definitions:

Variable Overhead Cost

Overhead costs that vary with the level of production or business activity, such as utilities or materials used in production.

Absorption Costing

A method of cost accounting that includes all manufacturing costs - direct materials, direct labor, and both variable and fixed manufacturing overhead - in the cost of a product.

Variable Costing

A costing method where only variable manufacturing costs are included in the cost of goods sold, with fixed manufacturing overhead treated as a period expense.

Absorption Costing

An accounting method that includes all manufacturing costs (both fixed and variable) in the cost of a product.