(Appendix 14A) the Change in Each of Kendall Corporation's Balance

question 5

Multiple Choice

(Appendix 14A) The change in each of Kendall Corporation's balance sheet accounts last year follows:
Kendall Corporation's income statement for the year was:
There were no sales or retirements of property, plant, and equipment and no dividends paid during the year. The company pays no income taxes and it did not purchase any long-term investments, issue any bonds payable, or repurchase any of its own common stock. The net cash provided by (used in) operating activities on the statement of cash flows is determined using the direct method.
-The selling and administrative expense adjusted to a cash basis would be:

• A) $120,000
• B) $106,000
• C) $110,000
• D) $112,000

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Definitions:

Direct Labor-hours

The cumulative hours spent by workers who are primarily engaged in creating products or providing services.

Quantity Standard

A predetermined measure of the quantity of inputs expected to be used in the production of goods or services, used for budgeting and performance evaluation.

Standard Cost System

An accounting system that uses predetermined costs for products and services to help managers control costs by comparing them with actual costs.

Raw Materials

The basic materials and components required to start the production process.