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Reil [10]
3 years ago
15

Cheyenne Corp. had the following transactions that took place during the year:I.Recorded credit sales of $2250II.Collected $1350

from customersIII.Recorded sales returns of $450 and credited the customer's account.What is the total effect of these transactions on free cash flow?a) No Effectb) Cannot be determinedc) Increased) Decrease
Business
1 answer:
Degger [83]3 years ago
7 0

Answer:

The correct option is d) <u>Decrease</u>.

Explanation:

Free cash flow (FCF) can be described as the cash that is generated by a company after cash outflows required to support operations and maintain the capital assets of the company have been accounted for.

Therefore, FCF can be calculated by adjusting for non-cash expenses, changes in working capital, and capital expenditures to reconcile net income.

The total effect of these transactions on free cash flow can be determined by first calculating the account receivable for the year as follows:

Calculation of account receivable for the year:

<u>Particular                                                     Amount ($)</u>

Credit sales                                                    2,250

Cash collected from the customer              (1,350)

Sales returns                                                <u>   (450)  </u>

Account receivable                                     <u>    450  </u>

A partial free cash flow statement can therefore be prepared as follows:

Cheyenne Corp.

Free cash flow statement (Partial)

<u>Particular                                                                   Amount ($)  </u>

Net income                                                                         xx

(Increase) decrease in non-cash current assets:

Increase in account receivable                                    <u>   (450)  </u>

Free cash flow                                                              <u>   (450)   </u>

<u />

Since the free cash flow is negative or minus $450, it therefore implies that the total effect of these transactions on free cash flow is a <u>decrease</u>.

Therefore, the correct option is d) <u>Decrease</u>.

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kipiarov [429]

The fact that support the idea that renting is a good is Landlords take care of most maintenance.

<h3>What is renting?</h3>

Renting refers to an agreement where a payment is made for the temporary use of a good, service or property owned by another.

It is obtaining a owner's property, in return for regular payments.

Hence, the fact that support the idea that renting is a good is Landlords take care of most maintenance.

Learn more about renting here : brainly.com/question/13393299

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3 0
1 year ago
For the just completed year, Hanna Company had net income of $41,500. Balances in the companys current asset and current liabili
mylen [45]

Answer:

$37,500

Explanation:

The computation of the net cash provided or used by operating activities are as follows

Cash flow from operating activities

Net income                          $41,500

Add: depreciation expenses $48,000

Add: Decrease in account receivable ($162,000 - $188,000) $26,000

Less: Increase in inventory ($442,000 - $370,000)  -$72,000

Add: Decrease in prepaid expenses ($11,500 - $14,000)  $2,500

Less: Decrease in account payable ($370,000 - $384,000) -$14,000

Less: Decrease in accrued liabilities ($8,500 - $12,000) -$3,500

Add: Increase in income tax payable ($36,000 - $27,000) $9,000

Cash flow provided by operating activities $37,500

The negative sign indicates the cash outflow and the positive sign indicated the cash inflow

3 0
3 years ago
An important social trend is the continued concern for health and well-being in the United States. This is most likely evidenced
yulyashka [42]

An important social trend is the continued concern for health and well-being in the United States is most likely evidenced by the introduction of fitness trackers such as the Fitbit.

<h3>What is social trend?</h3>

It should be noted that social trend simply means

the movement of a particular trend or its growth.

In this case, an important social trend is the continued concern for health and well-being in the United States is most likely evidenced by the introduction of fitness trackers such as the Fitbit

Learn more about social trend on:

brainly.com/question/2926894

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7 0
2 years ago
Assume that a piece of land is currently valued at $50,000. If this piece of land is expected to appreciate at an annual rate of
Luda [366]

Answer:

The correct answer is $132,664.89.

Explanation:

According to the scenario, the given data are as follows:

Present value (PV) = $50,000

Rate of interest (r) = 5%

Time period (n) = 20 Years

So, we can calculate future value by using following formula:

Future value = PV × (1 + r)^(n)

= $50000 × ( 1 + 5% )^20

= $50000 × (1 + 0.05)^20

= $132,664.89

Hence, After 20 years land will be worth $132,664.89.

5 0
2 years ago
Total Materials VarianceKrumple Inc. produces aluminum cans. Production of 12-ounce cans has a standard unit quantity of 4.7 oun
Nataliya [291]

Answer:

The correct answer for Price variance is $37,500( unfavorable) and for Usage variance is $19,200 ( Favorable).

Explanation:

According to the scenario, the given data are as follows:

Actual quantity = 1,875,000 ounces

Standard rate = $0.08 per ounce

Actual rate = $0.10 per ounce

Standard quantity = 4,50,000 × 4.7 = 2,115,000 ounces

So, Direct material price variance = Actual quantity × ( Standard rate - Actual rate )

= 1,875,000 × ( 0.08 - 0.10 )

= - $37,500 ( Negative shows Unfavorable)

and Direct material usage variance = standard rate per unit × (standard quantity - actual quantity)

=  $0.08 ( 2,115,000 - 1,875,000)

= 19,200 ( Positive shows Favorable)

3 0
3 years ago
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