You are studying with some classmates and are reviewing each other's responses to the following questions: "Why do companies offer sales discounts to customers? How would a sales discount 1/10; n/45 on a $2,000 purchase be interpreted?" Your classmate responds as follows: "Companies offer sales discounts in order to increase the amount of revenue they earn and to speed up the collection of cash from customers. If you are offered a sales discount of 1/10; n/45 on a $2,000 purchase, it means that you must pay before 10 days and, if you do, you will get 10% off, so you will only have to pay $1,800 to settle the account." Select the most appropriate response that your classmate could have made rather than the one that they made in the question. Companies offer sales discounts to encourage people to buy large volumes of goods. Offering a certain percentage discount will attract people to a store and improve sales. A sales discount 1/10; n/45 means that the customer will get 10% ($200) off if they pay within one day and, if they don't, the full $2000 amount is due within 45 days. The $200 sales discount is initially included in revenue and removed upon payment. Companies offer sales discounts to speed up the collection of cash from customers. 1/10; n/45 means that the customer will get a 1% discount ($20) if they pay within ten days; otherwise, the full $2000 amount is due within 45 days. The $20 sales discount is considered to be variable consideration. O Companies offer sales discounts to encourage sales. A sales discount of 1/10; n/45 means that the customer only has to pay 10% of the sales price if they pay within one day; otherwise, the full amount is due within 45 days. For a $2000 sale, the customer would only have to pay $200 if they paid within one day. If they don't take advantage of the discount, they will have to pay $2000 within 45 days. The sales discount amount is not included in revenue; it is considered to be variable consideration. O Companies offer sales discounts to speed up cash collections from customers. 1/10; n/45 means that the customer only has to pay $1800 if they pay within the first ten days; otherwise the full amount is due within 45 days. The $200 sales discount is initially included in revenue and removed upon payment. If a company reported net income for the year of $160,000, cash from operating activities of $105,000, cash flows from financing activities of $225,000, and cash used in investing activities of $450,000, what was their change in cash for the year? $120,000 decrease $170,000 decrease $40,000 increase O $65,000 decrease Which of the following is not usually a necessary condition before a selling company can recognize revenue? O It can reasonably estimate any future costs not yet incurred in the sale process. The amount of the revenue can be measured. The goods must have physically been received by the buyer. There is reasonable assurance of collectability of amounts earned