【正确答案】 A

【答案解析】Cash provided or used by operating activities under the direct method is computed by adding cash inflows and subtracting cash inputs and cash outflows. Operating Cash inflows for Rockway Inc. for 2005 came from sales ($ 21000000) and decrease in accounts receivable ($ 3000000- $ 2500000=$ 500000) for net cash inflows of ($ 21000000+$ 500000=) $ 21500000. Operating cash inputs were cost of goods sold ($ 15000000), plus the increase in inventory ($ 3000000-$ 2400000=$ 600000) less the increase in accounts payable, (which is a source of funds) ($1000000-$1400000=-$ 400000) for net cash inputs of ($15000000+$ 600000-$400000=) $ 15200000. Other operating cash outflows were interest paid ($1000000) and current income taxes paid ($1000000) totaling ($ 2000000). Cash provided by operations was ($ 21500000-$ 15200000- $ 2000000=) $4300000. Changes in property, plant and equipment, long-term debt and common stock do not affect cash from operations.