For Each of the Following Items, Indicate Whether It Would

question 146

Multiple Choice

For each of the following items, indicate whether it would be classified as an (O) operating activity, an (I) investing activity, a (F) financing activity, or a significant (N) noncash financing and investing activity.
-Issued stock for cash.

• A)F
• B)O
• C)N
• D)I

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Definitions:

Investment

The distribution of funds or assets with the intention of earning financial returns or profits.

Interest

Expenses incurred for the authorization to take out a loan, frequently shown as an annual rate in percentage.

Term Deposit

A financial product offered by banks that earns interest and is held for a predetermined period until it reaches the date of maturity.

Simple Interest Rate

An interest rate calculated only on the principal amount, not on previously earned interest.