Ask Question
BusinessBusiness
29 June, 01:33

Which of the following statements is correct? A. The payment of a cash dividend reduces net income. B. Cash received from issuing common stock to stockholders is reported as a financing activity cash flow within the statement of cash flows. C. Providing services to a customer on account does not impact net income. D. The purchase of manufacturing equipment is reported within the statement of cash flows as a financing activity.

+5
Answers (1)
  1. 29 June, 03:50
    0
    B. Cash received from issuing common stock to stockholders is reported as a financing activity cash flow within the statement of cash flows.

    Explanation:

    As when common stock is issued, it provides cash to the company, for any kind of investments, or expense to be made, for running the business.

    Financing activities are those which arrange monetary assets generally cash for the company, issue of securities, issue of bonds, borrowings as loans or note payable.

    Thus, the statement B is correct.

    Further dividends are provided after tax, and are distribution from net income, but not shown under that.

    Providing services on account will provide revenue and net income will increase.

    Purchasing of any equipment is investing as it will create an asset for the company.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Which of the following statements is correct? A. The payment of a cash dividend reduces net income. B. Cash received from issuing common ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
Waite Company's comparative balance sheet and income statement for last year appear below: The company declared and paid $24,000 in cash dividends during the year. The following questions pertain to the company's statement of cash flows.
Answers (1)
Why did the business world expand in the south?
Answers (1)
Suppose the government increases its spending and that net exports increase. In two or three sentences, explain how these actions affect economic performance.
Answers (1)
Agency relationships are normally consensual, coming about through voluntary consent and agreement between the parties. a. True b. False
Answers (1)
Jose is considering renting an apartment. He will need to make a?, which the landlord will return 21 days after the end of the rental agreement. He will also need to fill out a?.
Answers (1)
New Questions in Business
Which of the examples below illustrates the economic principle of a negative externality? a. cost or benefit of a transaction that involves the buyer or seller when both parties lose money b.
Answers (1)
Steven is considering taking a job with a company that is offering gym memberships, flexible hours, repayment of education loans, merchandise discounts, and childcare. these components of the job offer are called:
Answers (1)
Each scenario below gives some information about price elasticity of demand. for each, calculate the missing data, and determine if the price change under consideration will increase, decrease, or not change the firm/'s total revenue.
Answers (1)
Alpha Colony and Beta Colony both manufacture textiles and technology. Alpha Colony always produces higher quality textiles and technology with fewer raw materials and in less time than Beta Colony.
Answers (1)
RGB Company uses the percentage of receivables method for recording Uncollectible Accounts Expense. The accounts receivable balance is $100,000 at year-end and the total credit sales were $800,000.
Answers (1)
Home » Business » Which of the following statements is correct? A. The payment of a cash dividend reduces net income. B. Cash received from issuing common stock to stockholders is reported as a financing activity cash flow within the statement of cash flows. C.
Sign Up Forgot Password?