If Thomson Company Did Not Issue Any Bonds Payable During

question 21

Multiple Choice

If Thomson Company did not issue any bonds payable during the year and its bonds payable account decreased by $200,000 over the course of a year,then this amount would be shown on the company's statement of cash flows prepared under the indirect method as:

• A)a cash inflow of $200,000 under investing activities.
• B)a cash outflow of $200,000 under investing activities.
• C)a cash inflow of $200,000 under financing activities.
• D)a cash outflow of $200,000 under financing activities.

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Definitions:

Sales Forecast

An estimate of the amount of sales that a company expects to achieve in a certain period.

Discount Rate

The interest rate used to discount future cash flow to its present value, reflecting the time value of money and risk of the cash flow.

Project Life

The total duration from the initiation to the completion of a project, covering all stages of development and execution.

Accounting Break-Even

The point at which total revenues equal total expenses, and there is no profit or loss, specifically from an accounting perspective that includes non-cash expenses.