Financing Activities Include Receiving Cash from Issuing Debt and Receiving

question 88

True/False

Financing activities include receiving cash from issuing debt and receiving cash dividends from investments in other companies' shares.

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Definitions:

Purchase Returns

Goods returned by the buyer to the supplier due to defects, inaccuracies in shipment, or other discrepancies.

Allowances

A deduction from the gross amount on an invoice by the buyer for goods purchased or to cover some type of shortcoming.

Purchase Discounts

Reductions in the price of goods or services allowed by the seller for early payment by the buyer.

Contra Expense Accounts

Accounts that are used to offset or reduce expense accounts on the income statement, resulting in the net amount of expense being reported.