Wish Corporation Acquired a Computer for $15,000 and Paid for It

question 141

True/False

Wish Corporation acquired a computer for $15,000 and paid for it in full by issuing 1,000 shares of its own common shares, par $10 (current market price $15 share). This transaction should not be reported on the statement of cash flows because cash was neither paid out nor received.

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Definitions:

Market Price

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

Output Contract

An agreement where one party commits to sell, and the other to buy, all of a particular producer's output, ensuring a market for the seller and supply for the buyer.

Reasonably Proportionate

A criterion for determining whether a particular measure or action is fair and appropriate in its scope relative to its intended outcome or objective.

Gap Filler

refers to provisions or measures in a contract that deal with situations where the parties have omitted details.