Question
Pluto Company paid cash to purchase two identical inventory items. The first purchase cost $20.00 cash and the second cost $16.00 cash. Barker sold one
Pluto Company paid cash to purchase two identical inventory items. The first purchase cost $20.00 cash and the second cost $16.00 cash. Barker sold one inventory item for $40.00 cash. Based on this information alone, without considering the effect of income tax:
a)cash flow from operating activities is $10.00 assuming a LIFO cost flow
b) the amount of cash flow from operating activities is not affected by the cost flow method.
c)cash flow from operating activities is $11.00 assuming a weighted average cost flow.
d)cash flow from operating activities is $12.00 assuming a FIFO cost flow.
e)None of the given answers
f)Cash flow from operating is zero
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