Which of the Following Statements Is False

question 50

Multiple Choice

Which of the following statements is false?

• A) Purchase of equipment is an investing cash outflow.
• B) Sale of equipment creates investing cash outflow equal to its selling price.
• C) Purchase of short-term investments is an investing cash outflow.
• D) Purchase of a patent is an investing cash outflow.

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Definitions:

Operating Cost

Expenses associated with the day-to-day functions of a business, including costs for rent, utilities, and payroll.

Useful Life

The estimated period over which an asset is expected to be usable for its intended purpose, affecting depreciation calculations.

Economic Value

A measure of the benefit provided by a good or service to an economic agent, often quantified in terms of willingness to pay or the added utility it offers.

Operating Cost

Expenses related to the day-to-day functioning of a business, such as rent, utilities, salaries, and equipment maintenance.