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:

Equity-Financed

This refers to the method of funding a business or purchasing assets using primarily equity rather than debt.

Merger Premium

The additional amount that a company pays over the current market value of a target company during an acquisition, reflecting the anticipated synergy value.

Incremental Value

The additional value created by a new investment or project, compared to the scenario without it.

Equity-Financed

A method of raising capital whereby a company issues new shares of stock and receives fresh capital in return but does not incur debt.