Asked by Hermelinda Mendoza on Jun 19, 2024
Verified
If $700,000 of a company's own stock is sold, it is shown in the financing activities section.
Financing Activities
Transactions and events where cash is raised from or repaid to investors and creditors, such as issuing equity or borrowing.
Company's Stock
Equity securities representing ownership interests in a corporation, giving shareholders a claim on its earnings and assets.
- Develop comprehension about the disclosure of financing activities and their consequence on cash liquidity.
Verified Answer
LD
Lacie DraperJun 23, 2024
Final Answer :
True
Explanation :
The sale of a company's own stock is considered a financing activity because it involves raising capital for the company's operations or investments, and thus, it is reported in the financing activities section of the cash flow statement.
Learning Objectives
- Develop comprehension about the disclosure of financing activities and their consequence on cash liquidity.