In Preparing the Statement of Cash Flows for Year 4

question 61

Multiple Choice

In preparing the statement of cash flows for Year 4, internal records indicate that depreciation on manufacturing facilities totaled $800.The firm included this amount in cost of goods sold in the income statement for Year 4.None of the of depreciation required an operating cash flow during Year 4.The T-account work sheet entry adds back the $800 of depreciation on manufacturing facilities.Accountants treat depreciation charges on manufacturing facilities as

• A)a period expense.
• B)an opportunity cost.
• C)a product cost.
• D)a cost of capital.
• E)a marginal cost.

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Definitions:

Food and Drug Administration

A federal agency of the United States Department of Health and Human Services responsible for protecting and promoting public health through the control and supervision of food safety, tobacco products, dietary supplements, prescription and over-the-counter medications, vaccines, biopharmaceuticals, blood transfusions, medical devices, electromagnetic radiation emitting devices, cosmetics, animal foods & feed, and veterinary products.

Abbreviation

A condensed version of a word or phrase, created to make writing and speaking more straightforward.

NPO

An instruction meaning "nil per os" or nothing by mouth, used to restrict oral intake of food and liquids, typically before surgery or certain medical tests.

Expiration Date

The date after which a product like food, medicine, or cosmetics is not recommended to be used.