Operating expenses other than depreciation expense for the year were $335,000. Prepaid expenses increased by $7,000. Cash payments for operating expenses to be reported on the cash flow statement using the direct method would be:

Mike is given a bottle of wine as a gift. Josh, a neighbour, sees it and recognizes it as a very rare bottle. Knowing that Mike doesn't drink, Josh offers him $300 for it, which he believes to be a fair price. Mike happily agrees. Later, when Josh is looking up the price of the bottle on eBay, he realizes that it is not a valuable bottle of wine at all. He had confused it with another vintage. Josh, who is taking a law class, wonders whether or not he could have the contract set aside. Which of the following statements is true?

A) It is unlikely to be set aside unless Josh could show that it would be unfair or unjust to enforce it. B) It will automatically be set aside on the basis of the doctrine of mistake. C) It will only be set aside if Josh's mistake rendered the contract illegal. D) A contract can never be set aside where a mistake has been made. E) The contract will only be set aside if Josh's mistake was the result of willful blindness.

The New England Company has a debt to a bank of $55,000. The company is currently being liquidated and believes that between $12,000 and $20,000 will be paid on that debt. According to the liquidation basis of accounting, what amount is reported for this liability?

A. $12,000 B. $16,000 C. $20,000 D. $55,000