A Software Company Acquires a Smaller Company in Order to Acquire

question 26

Multiple Choice

A software company acquires a smaller company in order to acquire the patents that it holds. Where will the cost of this acquisition be recorded on the statement of cash flows?

• A) as an outflow under operating activities
• B) as an outflow under investment activities
• C) as an outflow under financial activities
• D) not recorded on the statement of cash flows

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Definitions:

Active Interest

Showing enthusiastic engagement and a high degree of attention in a particular subject or activity.

Talk Too Much

The act of speaking excessively or beyond what is necessary, often without considering the listener's interest or patience.

Critical Thinking

The objective analysis and evaluation of an issue or situation in order to form a judgment.

Cultural Awareness

Understanding and being sensitive to different cultural practices, beliefs, and values.