Which of the Following Is a Claims Exchange Transaction

question 88

Multiple Choice

Which of the following is a claims exchange transaction?

• A)Purchased machine for cash.
• B)Issued common stock.
• C)Invested cash in an interest earning account.
• D)Recognized revenue earned on a contract where the cash had been collected at an earlier date.

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Definitions:

Creditors' Claims

Rights or claims that creditors have against the assets of a company as a result of extending credit or lending money to the company.

Business Activities

Operations and actions undertaken by a company to generate revenue, such as sales, service provision, and production.

Acquisition

The process of obtaining control of another corporation or asset.

Disposal

The act of getting rid of an asset through sale, exchange, retirement, or destruction.