If net cash flows from operating activities were $316,000,net income were $200,000,and net sales were $2,000,000,cash flows to sales would equal (Round amounts to one decimal place)
A) 10.0%.
B) $116,000.
C) 15.8%.
D) 0.6 times.

Question

Quizplus · Accepted Answer

Cash flows to sales ratio can be calculated using the formula: 
Cash flows from operating activities / Net sales

In this case, the calculation would be: 
$316,000 / $2,000,000 = 0.158 or 15.8%

Therefore, the correct answer is C, which represents the percentage of cash flows from operating activities to net sales.

If Net Cash Flows from Operating Activities Were $316,000,net Income