Which of the Following Is True About the Initial Journal

question 114

Short Answer

Which of the following is true about the initial journal entry used to record quality-assurance warranties?

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Definitions:

Operating Activities

Activities that relate directly to the operation of a business, including sales revenue and expenses, reflected in the cash flow statement.

Decrease in Inventory

A reduction in the amount of goods available for sale or use, often reflected in financial statements and can indicate sales performance or a strategy to lower inventory levels.

Acquisition of Treasury Stock

The process by which a company buys back its own shares from the marketplace, reducing the amount of outstanding stock.

Investing Activities

Financial activities related to the acquisition and disposal of long-term assets and other investments not included in cash equivalents.