Dooling Corporation Reported Balances in the Following Accounts for the Current

question 124

Multiple Choice

Dooling Corporation reported balances in the following accounts for the current year:

Cost of goods sold was $7,500.What was the amount of cash paid to suppliers?

• A)$7,000.
• B)$7,200.
• C)$7,300.
• D)$7,500.

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Definitions:

Deferred Income Tax Liability

A tax obligation due in the future for income that has been recognized in the financial statements before it is taxable.

Tax Liability

Tax liability refers to the total amount of tax that an individual or entity is obligated to pay to a taxing authority, such as the government, based on income, property, and other applicable factors.

Income Tax Expense

The amount of money that a company owes to the government for income earned during a fiscal period.

Accounts Payable Turnover Ratio

A liquidity metric that measures the rate at which a company pays off its suppliers by comparing net credit purchases to average accounts payable.