Which of the Following Will Decrease the Balance in Retained

question 150

Multiple Choice

Which of the following will decrease the balance in Retained earnings?

• A) Cash dividend
• B) Stock split
• C) Purchase of long-term assets
• D) Purchase of treasury stock

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Definitions:

Investing Activities

Transactions involving the purchase and sale of long-term assets and other investments not included in cash equivalents.

Cash Outflow

The movement of money out of a business, typically as expenses or investments, resulting in a decrease in the company’s cash and cash equivalents.

Repay Principal

The process of paying back the original amount of money borrowed, not including interest, from a lender or creditor.

Paying Wages

The process of compensating employees for their labor, typically calculated by the hour, day, or based on output.