Phelps Company manufactures custom-designed filtering equipment for swimming pools and tanks. In May 2014, the company had net sales of $895,000 and incurred the following costs of quality: Product design costs $ 8,600 Product recall costs 5,200 Product simulation costs 13,500 Product testing costs 3,500 Product warranty claims 2,000 Scrap and rework costs 3,000 The costs of nonconformance to
percentage of net sales was
A) 1.1%
B) 2.9%
C) 4.0%
D) 4.5%
A
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On the statement of cash flows, a $7,500 gain on the sale of fixed assets would be
a. added to net income in converting the net income reported on the income statement to cash flows fromoperating activities b. deducted from net income in converting the net income reported on the income statement to cash flows fromoperating activities c. added to dividends declared in converting the dividends declared to the cash flows from financing activitiesrelated to dividends d. deducted from dividends declared in converting the dividends declared to the cash flows from financingactivities related to dividends
Cost of goods sold represents an outflow of an asset, inventory, from the sale of products
a. True b. False Indicate whether the statement is true or false
Which item below would most likely not favor buying (versus renting) a personal residence?
A) You expect inflation to increase. B) You expect an increase in income taxes. C) You expect mortgage rates to rise. D) You anticipate relocating frequently because of your job.
A cooperative business between two or more companies may be:
a. a joint-venture. b. a merger. c. a multinational corporation. d. All of the above