How Would the Purchase of Government Bonds by a Sporting

question 43

Multiple Choice

How would the purchase of government bonds by a sporting club be reported in the statement of cash flows?

• A) Financing outflow
• B) Financing inflow
• C) Investing outflow
• D) Investing inflow

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Definitions:

De Facto Corporation

A company that acts like a corporation and enjoys some of its benefits, despite not being duly incorporated according to statutory requirements.

Corporation By Estoppel

A defective corporation that has conducted business with a third party and therefore cannot deny its status as a corporation to escape liability.

Double Taxation

The imposition of two or more taxes on the same income, asset, or financial transaction, often referring to income taxed both at the corporate level and personally.

Excessive Taxation

Taxing beyond what is fair or reasonable, often perceived as placing undue burden on taxpayers.