Which of the Following Transactions Is Not a Direct Source

question 68

Multiple Choice

Which of the following transactions is not a direct source of cash?

• A) Borrowing cash.
• B) Disposal of inventory for cash.
• C) Sale and issuance of shares for cash.
• D) Sale of services on credit.

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Definitions:

Activity

An event that causes the consumption of overhead resources.

Variable Cost Per Unit

The cost that varies with the level of output, computed on a per-unit basis.

Fixed Cost

A fixed cost is a business expense that remains constant regardless of changes in production levels or sales volumes.

Relevant Range

The span of activity or production level within which the assumptions about fixed and variable costs are valid.