Which of the Following Statements About Financing Activities Is Not

question 60

Multiple Choice

Which of the following statements about financing activities is not correct?

• A)Cash dividends paid to a company's stockholders are reported as cash outflows from financing activities.
• B)When a company issues stock for cash,it reports a cash inflow from financing activities.
• C)When a company repurchases stock with cash,it reports a cash outflow for financing activities.
• D)When a company repays a loan,it reports a cash inflow from financing activities.

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Definitions:

Market Rate

The prevailing price or interest rate available in the marketplace for goods, services, or securities at a given time.

Contract Rate

The interest rate stated in a contract, such as a loan or bond agreement.

Present Value

The value in present terms of a sum of money or cash flows due in the future, determined with a set rate of return.

Future Cash Receipts

Expected inflow of cash to a business as a result of its operational activities, investments, or financing.