Which of the Following Is Not a Potential Fraud Related

question 63

Multiple Choice

Which of the following is not a potential fraud related to stockholders' equity accounts?

• A)Stock sales or issuances are not authorized.
• B)Entire loan payments are charged to either principal or interest.
• C)Dividends are paid in violation of restrictive covenants.
• D)Stock options are back-dated.

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Definitions:

Statement Of Cash Flows

A financial report that shows how changes in balance sheet accounts and income affect cash and cash equivalents, divided into operating, investing, and financing activities.

Operating Activities

Transactions and events that are directly related to the primary operations of a business, typically involving revenue and expense activities.

Investing Activities

Transactions involving the purchase or sale of long-term assets and other investments not considered cash equivalents, usually reflected in the cash flow statement of a company.

Cash Dividends

Payments made by a corporation to its shareholders, usually in the form of cash, out of its profits or reserves.