Which of the Following Financing Activities Results in a Cash

question 6

Multiple Choice

Which of the following financing activities results in a cash outflow?

• A) purchase of long-term investments.
• B) collecting accounts receivable.
• C) payment of dividends.
• D) issuance of bonds.

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Definitions:

Activity-Based Costing

A method of cost accounting that identifies activities in an organization and assigns the cost of each activity to all products and services according to the actual consumption by each.

Overhead Cost Per Unit

The allocation of total overhead costs to individual units of production, providing a per-unit cost of overhead expenses.

Expected Activity

An estimate of the volume of production or service levels a company anticipates, used for budgeting and planning.

Activity-Based Costing

A costing method that assigns overhead and indirect costs to specific activities and products based on their usage of resources.