Which of the Following Would Represent a Use of Funds

question 10

Multiple Choice

Which of the following would represent a use of funds and, indirectly, a reduction in cash balances?

• A) An increase in inventories
• B) A decrease in marketable securities
• C) An increase in accounts payable
• D) The sale of new bonds by the firm

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Definitions:

Invoice

A document issued by a seller to a buyer that details a transaction and requests payment for goods or services provided.

Debit

An entry recorded on the left side of a ledger account that increases an asset or expense account, or decreases a liability, equity, or revenue account.

Credit

A financial arrangement where goods, services, or money is received in exchange for a promise to pay back later, often with interest.

"Dr"

An abbreviation for "debit record," indicating an entry on the left side of an account, representing an increase in assets or expenses.