Which of the Following Transactions Is a Claims Exchange Transaction

question 78

Multiple Choice

Which of the following transactions is a claims exchange transaction?

• A) Paid cash to retire notes payable.
• B) Issued common stock for cash.
• C) Purchased office equipment for cash.
• D) Made adjusting entry to recognize the portion of unearned revenue that has been earned.

---

Definitions:

Consecutive Years

Years that follow one after another without interruption.

Involuntary Bankruptcy

A legal process initiated by creditors to force a debtor into bankruptcy proceedings, in order to recoup debts owed by liquidating the debtor's assets.

Nonprofit Organizations

Organizations that operate for charitable, educational, cultural, scientific, or social welfare purposes rather than for profit.

Means Test

An analysis conducted to determine an individual's financial eligibility for certain government assistance programs, based on income and assets.