Which of the Following Would Represent a Positive Source of Funds

question 75

Multiple Choice

Which of the following would represent a positive source of funds and, indirectly, an increase in cash balances?

• A) A reduction in accounts receivable
• B) The repurchase of shares of the firm's stock
• C) A decrease in net income
• D) A reduction in notes payable

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Definitions:

Predetermined Overhead Rate

A projected rate applied for distributing manufacturing overhead expenses across specific products or job orders.

Machine-Hours

A measure of the total time that manufacturing equipment is operating during a specific period, often used as a basis for allocating manufacturing overhead.

Unused Capacity

The available production or service capacity that is not being used, often considered when planning production schedules and resource allocation.

Period Expense

Expenses that are not directly tied to the production process and are charged to the periods in which they are incurred.