Servo Industries' Net Income Was $300,000 A)$487,000

question 4

Multiple Choice

Servo Industries' net income was $300,000.Given the account information below,what is the net operating cash flows for Servo Industries? $$\begin{array} { | l | r | } \hline \text { Decrease in Acc ounts Receivable } & \$ 50,000 \\\hline \text { Decrease in Salaries Payable } & \$ 75,000 \\\hline \text { Decrease in Inventory } & \$ 20,000 \\\hline \text { Depreciation Expense } & \$ 35,000 \\\hline \text { Increase in Interest Payable } & \$ 7,000 \\\hline\end{array}$$

• A)$487,000.
• B)$323,000.
• C)$337,000.

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Definitions:

Price Elasticity

An assessment of demand's elasticity regarding the pricing changes of a specific product.

Demand

The quantity of a good or service that consumers are willing and able to purchase at various prices, holding all else constant.

Cost Function

An equation that calculates the total cost incurred by a company to produce a specific quantity of a good or service.

Long-run Equilibrium

A market condition where all factors of production and inputs can be varied, allowing firms to enter or exit the market, ultimately resulting in no economic profit for any firm.