Issuing Bonds Are Shown on the Statement of Cash Flows

question 51

Multiple Choice

Issuing bonds are shown on the statement of cash flows as:

• A)operating activities.
• B)investing activities.
• C)financing activities.
• D)none of the above. It is not shown on the statement of cash flows.

---

Definitions:

Cost Of Debt

The effective rate that a company pays on its total debt, acting as a measure of the risk and cost of borrowing capital.

Operating Income

Income generated from regular business operations, excluding non-operating activities like investment income.

Total Leverage

The combined effect of using both operating and financial leverage on a company's earnings per share.

Financial Leverage

Employing leveraged capital to enhance the expected returns on an investment.