The Largest Annual Supply of External Funds for Business Corporations

question 202

Multiple Choice

The largest annual supply of external funds for business corporations comes from issuance of which one of the following sources?

• A) privately placed stocks
• B) bonds
• C) preferred stocks
• D) common stocks

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Definitions:

Direct Method

A cost allocation method that assigns service department costs directly to production departments without considering services provided between service departments.

Accounts Receivable

represents the money owed to a company by its customers for goods or services delivered but not yet paid for.

Prepaid Expenses

Payments made for goods or services before receiving them, recorded as assets in the balance sheet until they are utilized or consumed.

Direct Method

A cash flow forecasting technique that involves estimating cash inflows and outflows from actual sources and uses, as opposed to indirect adjustments.