Which of the Following Transactions Affects Both the Income Statement

question 95

Multiple Choice

Which of the following transactions affects both the income statement and the statement of cash flows?

• A)Selling stock in exchange for cash.
• B)Declaring and paying a cash dividend.
• C)Selling a product to a customer which creates an account receivable.
• D)Paying employee wages as they are earneD.Paying an employee wages as they are earned results in an expense being recognized (income statement) and a cash outflow (statement of cash flows).

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Definitions:

Stakeholder Input

The contributions, feedback, or opinions provided by individuals or groups affected by the decisions or activities of an organization.

Ethics Audit

A systematic evaluation of an organization's ethical policies, practices, and culture to identify strengths, weaknesses, and areas for improvement.

Ethics Audit

An in-depth examination of how an organization's actions align with its stated ethical guidelines, aimed to uncover areas requiring enhancement.

Financial Audit Committee

A subgroup of a company’s board of directors focused on overseeing the financial reporting and disclosure process.