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patio furniture? If yes, which value should it use?Should the company
consider the concrete slab when expanding its outdoor garden shop to include
patio furniture? If yes, which value should it use?
(Select the best
response.)
A.
No. The slab is a sunk cost unless there is another use for the slab that could
provide cash flow to Richardses' Tree Farm. The additional cash flow that
the slab could provide is the opportunity cost, not the current replacement
cost or the original cost.
B.
Yes, use
$13 comma 000
as the cost.
C.
Yes, use
$8 comma 000
as the cost.
P10-5
Working capital cash flow. Cool Water, Inc. sells bottled water. The firm
keeps in inventory plastic bottles at 12% of the monthly projected sales. These
plastic bottles cost $0.007 each. The monthly sales for the first four months of
the coming year are as follows:
What is the monthly increase or decrease in cash flow for inventory given that
an increase is a use of cash and a decrease is a source of
cash? Note: Enter a decrease as a negative number.