Hey, I have a take home test from one of my intermediate accounting classes and I need some help. Here is the question: 1. The company’s COGS for the yr ended October 31, 19y was 1,000,000 while its inventories increased 100,000; A/P decreased 50,000 and SG&A expenses equaled $75,000. What was the amount of cash paid to suppliers and employees under the Direct approach? Now cash paid to supplies is easy, however, cash paid to employees is tricky. Not sure if that part is a trick question or if I should go off the assumption that the full amount of the $75,000 is completely attributable to the amount of cash paid for the salaries of the non-sales employees. What do you think? Extra unnecessay info or useful? Thanks!
Dude, You’re actually asking for help with your homework? The only point I’ll make is, did you post the question verbatim? SG&A encompasses more than just comp to employees. You can’t answer the question based on the info provided.
It’s not HW it’s a take home test. Is that a problem that I’m asking for a little assistance? In the mix of studying for lvl 2 I am also taking this class, which very much relates to the CFA so it’s not a completely off the topic question. If I was taking chemistry, I obv would not post a question. That’s the question verbatim. SG&A Expense does encompass more than just salaries, that’s why it’s confusing. I am going to put 75k down as the answer. Thanks for responding.
At least I’m not asking questions about how to pass the CFA with 2 days of studying lol
its not possible to answer the question based on the data you’ve been provided. That would be the best answer.
cash paid to suppliers is covered in FRA Level I.
Cashflow is also tested heavily in Equity on lvl 2. thank u, thank u.
there are many CPA forums where you can post this
Hey guess what? I have 9 times the amount of posts as u faraz. I have contributed enough on this forum to earn me the right to ask a question somewhat but not really off topic. So shut it
You can’t answer the question based on the facts provided here. Like other have said, SG&A encompasses more than just salaries to employees. You might want to shoot an email to your professor, but I am very sure that this cannot be solved without more info.