Which of the Following Is a Noncash Investing and Financing

question 104

Multiple Choice

Which of the following is a noncash investing and financing activity?

• A) payment of a cash dividend
• B) payment of a six-month note payable
• C) purchase of inventory on account
• D) issuance of common stock to acquire land

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Definitions:

Long Run Equilibrium

A state in which all factors of production and costs are variable, and firms no longer have an incentive to enter or exit an industry, leading to a stable market condition.

Firm

A business organization that sells goods or services in order to make a profit.

Producer Surplus

The difference between what producers are willing to receive for a good or service and the actual amount they receive, due to the market price being higher.

Fixed Costs

Expenses that do not change with the level of production or sales, such as rent, salaries, and insurance premiums.