Regular production costs $25 per unit and selling a unit represents a cash inflow of $30 per unit. Assume that all units reflected on the forecast will be sold. What is the cumulative net cash flow at the end of April?
Month Forecast Regular Production
January 250 250
February 200 200
March 300 300
April 400 400
What will be an ideal response?
Answer: The cumulative net cash flow at the end of April is $5750. The table shows the month-by-month accumulation.
Month Forecast Regular Production Cash Inflows Cash Outflows Cumulative
January 250 250 7500 6250 1250
February 200 200 6000 5000 2250
March 300 300 9000 7500 3750
April 400 400 12,000 10,000 5750
You might also like to view...
When a bond is purchased for an investment, the purchase price, minus the brokerage commission, plus any accrued interest is recorded
a. True b. False Indicate whether the statement is true or false
Which of the following types of research seeks conclusive evidence, which is based on large, representative samples and typically applies some form of statistical analysis?
A) qualitative research B) lead research C) quantitative research D) hypothetical research E) total research
Which of the following is not a formal definition of assets that has been used by the accounting profession in the US?
a. Something represented by a debit balance that is or would be properly carried forward upon a closing of books of account according to the rules or principles of accounting, on the basis that it represents either a property right or value acquired, or an expenditure made which has created a property or is properly applicable to the future. b. Economic resources of an enterprise that are recognized and measured in conformity with generally accepted accounting principles as well as certain deferred charges that are not resources but that are recognized and measured in conformity with generally accepted accounting principles. c. Probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events. d. Only those economic resources that can be severed from the firm and sold.
Point Co. purchased 90% of Sharpe Corp.'s voting stock on January 1, 20X2 for $5,580,000. Prior to the acquisition, Point held a 10% equity position in Sharpe Company. On January 1, 20X2 Pointe's 10% investment in Sharpe has a book value of $340,000 and a fair value of $620,000. On January 1, 20X2 Point records the following:
A. Credit Investment in Sharpe stock $5,860,000 B. Debit Investment in Sharpe stock $6,200,000 C. Debit Gain on revaluation of Sharpe's stock $280,000 D. Credit Gain on revaluation of Sharpe's stock $280,000