The Acquisition of Land by Issuing Common Stock Is

question 23

Multiple Choice

The acquisition of land by issuing common stock is

• A)a noncash transaction that is not reported in the body of a statement of cash flows.
• B)a cash transaction and would be reported in the body of a statement of cash flows.
• C)a noncash transaction and would be reported in the body of a statement of cash flows.
• D)only reported if the statement of cash flows is prepared using the direct method.

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Definitions:

Acquisition

An acquisition involves one company purchasing most or all of another company's shares or assets, effectively taking control over the acquired company.

Fair Value Adjustments

Modifications made to the reported value of assets or liabilities to reflect their actual market value.

Business Combination

This occurs when two or more businesses come together to form a single company, often through acquisitions or mergers.

Recording Method

A system or standard procedure for capturing financial transactions and events in an organization's accounting records.