Business Degree Certification Practice Test

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Prepare for your Business Degree Certification Test with our comprehensive quiz. Utilize flashcards, multiple choice questions, hints, and explanations to build your proficiency. Excel in your exam!

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Based on the financial data provided, what is the corporation's net cash flow from operating activities?

$98,000
$102,000
$108,000
$118,000

The correct answer is: $108,000

To determine the corporation's net cash flow from operating activities, one must analyze the cash generated or used by the core business operations. This calculation typically involves examining the cash inflows from sales and services and subtracting cash outflows for operational expenses. When reviewing financial data, one should consider factors such as: 1. Cash receipts from customers: This includes all cash collected from sales during the period. 2. Cash payments to suppliers and employees: This encompasses all operational costs that affect cash flow, including wages, rent, and any other expenses necessary to run operations. Net cash flow from operating activities is essential because it reflects the financial health of the business's primary operations, showing how well the company generates cash through its day-to-day activities. In this context, a net cash flow of $108,000 indicates that after accounting for cash inflows and outflows related to the company’s operational activities, this amount remains. It suggests that the company is generating a positive cash flow, which is vital for sustaining operations, reinvesting, and fulfilling other financial obligations. Thus, the figure of $108,000 is the calculated net cash flow from operating activities based on the considered cash transactions during the reporting period.