Which of the Following Best Describes a Company's Financing Activities

question 165

Multiple Choice

Which of the following best describes a company's financing activities?

• A)Financing activities focus on the sale of products and services.
• B)Financing activities include selling products.
• C)Financing activities enable a company to acquire assets needed to run a business.
• D)Financing activities are represented by the revenues and expenses on the income statement.

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Definitions:

Prepaid Rent

An asset account that represents payment for rent that covers a future period, reflecting rent expense that has not yet been incurred.

Adjusting Entry

A journal entry made at the end of an accounting period to record unrecognized income or expenses in order to maintain accrual accounting accuracy.

Rent Expense

The cost incurred for using a property or space for business or residential purposes.

Contra Asset Account

An account that offsets or reduces the balance of a related asset account, used to record reductions or allowances, like accumulated depreciation.