Which of the Following Is a Noncash Investing and Financing

question 65

Multiple Choice

Which of the following is a noncash investing and financing activity?

• A) payment of a cash dividend
• B) payment of a six-month note payable
• C) purchase of merchandise inventory on account
• D) issuance of common stock to acquire land

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Definitions:

Depreciation

A method to allocate the cost of a tangible asset over its useful life.

Utilities

Services such as electricity, gas, water, and sewer that are used by businesses and households, often considered basic necessities.

Raw Material

The basic material from which a product is made, typically unprocessed or minimally processed before being used in production.

Work in Process

The inventory account that records products in production but not yet completed.