The Income Statement for CBA Reported a Net Loss of $14,000

question 146

Multiple Choice

The income statement for CBA reported a net loss of $14,000. Also, the statement reported depreciation expense of $12,000 and amortization of patents of $6,000. Assuming no additional "adjustments to reconcile net income to cash from operating activities," the cash flow from operations would be a:

• A) $4,000 inflow.
• B) $6,000 inflow.
• C) $16,000 inflow.
• D) $30,000 inflow.
• E) ($4,000) outflow.

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Definitions:

Manufacturing Overhead

All indirect factory-related costs incurred during the production process, excluding direct materials and direct labor costs.

Direct Labour-Hours

The total amount of time workers spend directly manufacturing a product or providing a service.

Prototype Testing

The process of evaluating a preliminary model of a product to assess its performance, design, and reliability before it goes into mass production.

Batch Level Activity

Operations or tasks that are performed on groups of products together, typically as a step within the production process, where costs are incurred for the batch as a whole rather than for individual units.