Which of the Following Statements Is True

question 149

Multiple Choice

Which of the following statements is true?

• A) The corporation will have cash inflow when bonds are issued for an amount equal to, greater than, or less than the par value of the bonds.
• B) The corporation will have to pay cash to bond investors when those investors demand to call the bonds.
• C) The corporation will have an outflow of cash connected to an investing activity when interest is paid to bond investors.
• D) An outflow of cash when convertible bonds are converted is a financing activity.

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Definitions:

Equity Funds

Investment funds that primarily invest in stocks, aiming to provide growth or income to investors.

Bond Funds

Investment funds that pool money from various investors to purchase a diversified portfolio of bonds, providing income and diversification.

Net Asset Value

The total value of a fund's assets minus its liabilities, often used to determine the value of shares in a mutual fund or ETF.

Year-End Assets

The total value of all assets that a company or individual owns at the end of a fiscal year.