Mutual Funds Sell Shares to Investors and Use the Funds

question 8

Multiple Choice

Mutual funds sell shares to investors and use the funds to

• A)purchase Treasury bonds.
• B)invest in a portfolio of financial assets.
• C)purchase newly issued shares of a particular company's stock.
• D)pay dividends.

---

Definitions:

Inventories

are the raw materials, work-in-progress products, and finished goods that are considered to be the portion of a business's assets that are ready or will be ready for sale.

Operating Expense

Operating expense refers to the costs associated with the day-to-day operations of a business, excluding direct production costs.

Investing Activity

Transactions involving the purchase and sale of long-term assets and other investments, not directly related to the entity's primary business operations.

Land

Land is a tangible asset representing a piece of earth's surface which is owned and has a specific value attached to it, often used for commercial or residential purposes.