Which of the Following Transactions Would Not Create a Cash

question 69

Multiple Choice

Which of the following transactions would not create a cash flow?

• A)The company purchased some of its own shares from a shareholder.
• B)Amortization of patent for the period.
• C)Payment of a cash dividend.
• D)Sale of equipment at book value (i.e.no gain or loss).

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Definitions:

Mortgage

A mortgage is a legal agreement by which a bank or other creditor lends money at interest in exchange for taking title of the borrower's property, with the condition that the conveyance of title becomes void upon the payment of the debt.

Remaining Balance

The total amount still owed on a debt or loan, not including current or future interest.

State Statute

A written law enacted by a state legislature governing matters within the state's jurisdiction.

Lien

A legal claim or right against a property as security for a debt or charge that must be paid when the property is sold.