Which One of the Following Is a Primary Market Transaction

question 23

Multiple Choice

Which one of the following is a primary market transaction?

• A) A dealer selling shares of stock to an individual investor.
• B) A dealer buying newly issued shares of stock from a corporation.
• C) An individual investor selling shares of stock to another individual.
• D) A bank selling shares of a medical firm to an individual.
• E) A sole proprietor buying shares of stock from an individual investor.

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Definitions:

Indirect Method

A way of calculating cash flows from operations by starting with net income and adjusting for non-cash transactions and changes in working capital.

Operating Activities

Activities that relate directly to the business's primary operations, such as sales, provision of services, production, and associated expenses.

Statement of Cash Flows

A financial report that provides a summary of a company's cash inflows and outflows over a certain period, showing how it raises and spends cash.

Statement of Cash Flows

A financial report detailing modifications in balance sheet accounts and income's impact on cash and equivalents, segmented into operating, investing, and financing activities.