Increases and Decreases in the Long-Term Assets Are Reported on the Statement

question 142

Multiple Choice

Increases and decreases in the long-term assets are reported on the statement of cash flows as:

• A)operating activities.
• B)investing activities.
• C)financing activities.
• D)noncash activities.

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Definitions:

Variable Production Costs

Expenses that change in direct proportion to the level of production output.

Cost-Volume-Profit Analysis

An accounting method used to determine how changes in costs and volume affect a company's operating income and net income.

Contribution Format

An income statement format that separates fixed and variable costs, showing the contribution margin which covers fixed costs and profits.

Absorption Costing

A bookkeeping strategy that encompasses all production expenses, including direct materials, direct labor, and variable plus fixed overhead, into the pricing of a product.