When a Company Issues and Sells New Stock or Uses

question 82

Multiple Choice

When a company issues and sells new stock or uses retained earnings to meet its financial needs, it is using _____.

• A) equity financing
• B) debt financing
• C) export financing
• D) spontaneous financing

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Definitions:

Property, Plant, and Equipment

Long-term tangible assets used in the operation of a business that are expected to be used over several years, including buildings, machinery, and vehicles.

Direct Materials Variances

The difference between the budgeted cost of direct materials and the actual cost incurred.

Fixed Overhead

The portion of total overhead costs that do not change with the level of production or activity within a certain range.

Property, Plant, and Equipment

Long-term tangible assets used in the operation of a business, not expected to be converted to cash in the next year.