A Company Is Involved in Operating Activities When These

question 104

Multiple Choice

A company is involved in operating activities when these:

• A)activities are directly related to running the core business to earn profits.
• B)activities involve buying and selling productive resources with long lives (such as buildings,land,equipment,and tools),purchasing investments,and lending to others.
• C)activities involve borrowing from banks,repaying bank loans,receiving contributions from shareholders,or paying dividends to shareholders
• D)All of the above

---

Definitions:

Property Plant Equipment

Long-term tangible assets held for business use and not expected to be converted into cash in the current or upcoming fiscal year, including land, buildings, machinery, and vehicles.

Free Cash Flow

The amount of cash generated by a business after accounting for capital expenditures needed to maintain or expand the asset base.

Common Stock

A type of security that represents ownership in a corporation, entitling the shareholder to a proportion of the corporation's assets and profits.

Depreciation

The systematic allocation of the cost of an asset over its useful life.