In Preparing a Statement of Cash Flows,sale of Treasury Stock

question 66

Multiple Choice

In preparing a statement of cash flows,sale of treasury stock at an amount greater than cost would be classified as a(n)

• A) transfer activity.
• B) operating activity.
• C) investing activity.
• D) financing activity.

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Definitions:

Generally Accepted Accounting Principles

A set of accounting standards and principles that guide the financial reporting process for public companies in the United States.

Financial Accounting Standards Board

An independent, nonprofit organization responsible for establishing accounting and financial reporting standards for companies and non-profit organizations in the United States.

Public Company Accounting Oversight Board

A regulatory body established by Congress to oversee the audits of public companies in order to protect investors and the public interest.

Return on Assets Ratio

An indicator of how profitable a company is relative to its total assets, measuring the efficiency of asset use.