LFM Corporation Reported Cost of Goods Sold on Its Income

question 6

Multiple Choice

LFM Corporation reported cost of goods sold on its income statement of $15,000.The following account balances appeared on the company's comparative balance sheet for the same year: The company uses the direct method to determine the net cash provided by operating activities.The cost of goods sold,adjusted to a cash basis,on the company's statement of cash flows for the year would be:

• A)$14,000
• B)$16,000
• C)$10,000
• D)$15,000

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Definitions:

Financial Statement Presentation

The method by which a company's financial data is arranged and reported to external parties, typically including balance sheets, income statements, and cash flow statements.

Disclosure

The act of making information known, especially information that is of interest to shareholders and potential investors regarding a company's performance and operations.

Segment Information

Details about the different operational or geographical segments of a company, required in financial reports to give insight into performance and risks.

AASB 1039 Concise Financial Reports

Australian accounting standard that provides guidelines on preparing abbreviated financial statements that present a concise overview of a company's financial performance and position.