A Statement of Cash Flows Generally Would NOT Include the Effects

question 77

Multiple Choice

A statement of cash flows generally would NOT include the effects of

• A) common shares issued at an amount greater than par value.
• B) the purchase of treasury shares.
• C) cash dividends paid.
• D) stock dividends declared and issued.

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Definitions:

Common Stock

represents units of ownership in a corporation, giving shareholders voting rights and a share in the company’s profits through dividends.

Market Value

The current quoted price at which an asset or service can be bought or sold in a marketplace.

Owners' Equity

The residual interest in the assets of an entity after deducting liabilities, representing the ownership interest of shareholders.

Stock Option Plan

A compensation strategy used by companies to grant employees the right to purchase company shares at a predetermined price after a specified period.