Which of the Following Statements Is True

question 62

Multiple Choice

Which of the following statements is true?

• A)GAAP classifies dividends paid as a financing activity,but IFRS allows them to be classified as either an operating or financing activity.
• B)GAAP allows interest paid to be classified as either an operating or financing activity,but IFRS requires that it be classified as a financing activity.
• C)GAAP classifies dividends received as an investing activity,but IFRS allows them to be classified as either an operating or investing activity.
• D)GAAP classifies interest received as either an operating or investing activity,but IFRS requires it to be classified as an investing activity.

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Definitions:

Income Statement

A financial statement that shows a company's financial performance over a specific period by summarizing its revenues, expenses, and net income or loss.

Finished Goods Inventory

The total value of all completed products that are ready for sale but have not yet been sold.

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials and labor.

Cost of Goods Manufactured

The total cost accrued in making products completed during an accounting period, including labor, material, and overhead costs.