181k views
1 vote
If revenue is $7,000 and operating expenses are $6,000, cash flow equals _______.

Options:
Option 1: $1,000
Option 2: $13,000
Option 3: -$1,000
Option 4: -$13,000

1 Answer

4 votes

Final answer:

Cash flow is calculated by subtracting operating expenses from revenues. For revenue of $7,000 and operating expenses of $6,000, the cash flow would be $1,000, indicating that the business has a surplus. The correct answer is Option 1: $1,000.

Step-by-step explanation:

If revenue is $7,000 and operating expenses are $6,000, the calculation for cash flow can be determined by subtracting the operating expenses from the revenues. Cash flow is a financial metric that shows how much money is entering and leaving a company during a particular period. To find the cash flow, we use the formula:

Cash Flow = Revenue - Operating Expenses

In this case, it would be:

Cash Flow = $7,000 - $6,000 = $1,000

The correct answer is Option 1: $1,000. This positive amount indicates that the company has a surplus after accounting for its operating expenses, which is generally a favorable position for any business.

User Nishchal Sharma
by
8.0k points

No related questions found

Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.