Use This Information to Answer the Following Question

question 85

Multiple Choice

Use this information to answer the following question.

Oconee Corporation is preparing a statement of cash flows. The following transactions occurred during the year:

1. Sold machinery for $18,000 cash.
2. Purchased a building for $160,000 cash.
3. Issued $140,000 worth of stock to acquire an airplane.
4. Converted long-term bonds by issuing $200,000 worth of stock.
5. Declared and paid a $20,000 cash dividend.

Transaction 2 would be found on the statement of cash flows in the

• A) cash flows from operating activities section.
• B) cash flows from financing activities section.
• C) cash flows from investing activities section.
• D) noncash investing and financing transactions section.

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Definitions:

External Auditors

Independent accountants or audit firms that review a company's financial statements to ensure accuracy and compliance with accounting standards.

Securities & Exchange Commission

A government agency that oversees securities transactions, activities of financial professionals, and mutual fund trading to prevent fraud and intentional deception.

Financial Disclosure

The process of providing financial information to stakeholders about a company's performance, financial status, and operations.

Form 10-K

An annual report required by the U.S. Securities and Exchange Commission that gives a comprehensive summary of a company's financial performance.