When You Set Aside the Money You Have Today in Order

question 503

Multiple Choice

When you set aside the money you have today in order to purchase goods and services later on, you are using money as a

• A) medium of exchange.
• B) standard of deferred payment.
• C) unit of accounting.
• D) store of value.

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Definitions:

Direct Method

A way of preparing the cash flow statement where actual cash flow information from the company's operations is used, rather than accrual accounting values.

Operating Activities

Activities directly related to a company's core business operations, including income-earning endeavors and other functions central to its purpose.

Statement Of Cash Flows

A financial statement that summarizes the amount of cash and cash equivalents entering and leaving a company, showing how it raises and spends cash.

Cash Received

The actual inflow of cash into a business from various sources such as sales, financing, or investment activities.