All of the Following Transactions Decrease the Fund Balance of a Governmental

question 28

Multiple Choice

All of the following transactions decrease the fund balance of a governmental fund except

• A) Purchase of equipment.
• B) Retirement of the principal of a short-term note.
• C) Payment of salaries and wages.
• D) Purchase and use of supplies.

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Definitions:

Strike Price

The set price at which an options contract can be bought (call) or sold (put) when it is exercised.

Call Option

A financial contract giving the buyer the right, but not the obligation, to buy an asset or financial instrument at a specified price within a specific time period.

Strike Price

The specified price at which the holder of an option contract can buy (call option) or sell (put option) the underlying asset until the expiration date.

Conversion Ratio

A key term in finance, specifically in convertible securities, representing the number of shares an investor can convert a bond into.