The Use of Cash-Out Combinations Has Raised Questions Concerning Both

question 68

Multiple Choice

The use of cash-out combinations has raised questions concerning both their purpose and their fairness to minority shareholders. In this context, fairness includes:

• A) fair dealing.
• B) fair price.
• C) both (a) and (b).
• D) tender.

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Definitions:

Journal Entry

An accounting transaction entered into a ledger that denotes the financial activities of a company.

Statement of Cash Flows

A summary statement which tracks all cash inflows to a company from its regular business operations and funds received from investments, plus all cash outflows for paying business and investment costs within a certain period.

Investing Activities

Transactions involving the purchase or sale of long-term assets and investments which are not related to the entity's primary business operations.

Financing Activities

Activities that result in changes in the size and composition of the equity capital and borrowings of an entity.