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Unformatted text preview: e by the amount of the gross profit.
d The sale is reported as an operating cash inflow when the sale is made.
e None of the above 16 Depreciation expense
a is an operating cash outflow.
b reduces gross profit.
c increases the net carrying value of the fixed asset.
d is a financing cash outflow.
e None of the above 17 If current assets increased from $11,000 at the beginning of the year to 16,000 at the end of the year, and current liabilities decreased
from $10,000 at the beginning of the year to $5,000 at the end of the year, what is the company's approximate current ratio if the
company's net income was $26,000 during the most current period?
e 5.2 18 If the accountant mistakenly took twice as much depreciation as should have been taken, the result would be
a overstated assets and overstated retained earnings.
b understated assets and understated stockholders' equity.
c overstated assets and understated liabilities.
d understated assets and overstated net income....
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- Spring '08