Which of the Following Statements Is True

question 143

Multiple Choice

Which of the following statements is true?

• A)Investment in another company's common stock is classified as a cash outflow from financing activities on the Statement of Cash Flows.
• B)Repayment of long-term debt is classified as a cash outflow from investing activities on the Statement of Cash Flows.
• C)Losses on the sale of long-term assets are an adjustment reported in the operating activities section of the Statement of Cash Flows under the indirect method.
• D)Dividends paid are classified as a cash outflow from operating activities on the Statement of Cash Flows.

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Definitions:

Standard Hours Allowed

The amount of time that should be spent on producing a certain number of units under normal conditions.

Denominator Activity

A term used in cost accounting to refer to the level of activity used to allocate fixed costs to cost units.

Variable Overhead Efficiency Variance

The difference between the actual variable overhead based on hours worked and the standard cost of variable overhead for those hours, indicating efficiency in controlling variable overhead costs.

Variable Manufacturing Overhead Cost

The portion of manufacturing costs that varies with the level of production output, including costs such as indirect materials and utilities.