Which of the Following Would Be an Example of a Financing

question 86

Multiple Choice

Which of the following would be an example of a financing transaction?

• A)Purchasing equipment for cash.
• B)Buying inventory from a supplier on credit.
• C)Selling shares to investors for cash.
• D)Buying inventory from a supplier for cash.

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Definitions:

Unearned Revenues

Funds received by a company for goods or services that have not yet been delivered or rendered, considered a liability until the product or service is provided to the customer.

Liabilities

Liabilities that a business must settle in the future, representing the financial debts owed to external parties.

Prepaid Expenses

Costs that have been paid in advance for goods or services to be received in the future.

Unearned Revenues

Money received by a company for goods or services that have not yet been provided to the customer.