Which of the Following Is Not Considered a Financing Activity

question 27

Multiple Choice

Which of the following is not considered a financing activity when preparing the statement of cash flows?

• A) issuance of common stock
• B) redemption of bonds payable
• C) payment of dividends
• D) receipts on notes receivable

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Definitions:

Liquidation Date

The predetermined date on which an investment or venture is terminated, and all assets are liquidated.

Defined Contribution Pension Plan

A retirement plan where both employer and employee contribute to an individual account for the employee, with benefits depending on investment performance.

Bears All The Risk

A term indicating that one party in a transaction is responsible for any financial losses or risks that may arise, commonly used in insurance and investment contexts.

Variable Life

A type of life insurance policy that includes an investment component, where the cash value and death benefit can vary based on the performance of the investments.