Cohen Company Experienced an Accounting Event That Affected Its Financial

question 32

Multiple Choice

Cohen Company experienced an accounting event that affected its financial statements as indicated below: $$\begin{array} { | c | c | c | c | c | c | c | c | c | c | c | } \hline \begin{array} { c } \text { Assets } \\+\end{array} & = & \begin{array} { c } \text { Liab. } \\\text { NA }\end{array} & + & \begin{array} { c } \text { Equity } \\+\end{array} & \begin{array} { c } \text { Rev } \\\text { NA }\end{array} & - & \begin{array} { c } \text { Exp } \\\text { NA }\end{array} & = & \begin{array} { c } \text { Net } \\\text { Inc. } \\\text { NA }\end{array} & \begin{array} { c } \text { Cash } \\\text { Flow } \\+ \text { FA }\end{array} \\\hline\end{array}$$ Which of the following accounting events could have caused these effects on Cohen's statements?

• A) Paid a cash dividend.
• B) Earned cash revenue.
• C) Borrowed money from a bank.
• D) Issued common stock.

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Definitions:

Semiannual Interest

Interest calculated or paid twice a year on loans, bonds, or savings accounts.

Bonds Dated

The date specified in the bond document when the bond was issued, important for determining interest payments and maturity.

Fair Value

An estimate of the price at which an asset would be bought or sold in a current transaction between willing parties, not under compulsion.

Market Price

The prevailing market rate at which transactions for assets or services are conducted.