Asked by Victoria Nguyen on May 16, 2024
Verified
When a company issues common stock in exchange for cash,a cash inflow from a financing activity is reported.
Common Stock
A form of corporate equity ownership, a type of security representing ownership in a corporation.
Financing Activity
Transactions involving the exchange of financial instruments, typically related to the borrowing, repaying, or raising of capital for a company.
Cash Inflow
The total amount of money being transferred into a business, typically from operational, investment, and financing activities.
- Gain insight into the ramifications of ordinary share activities on financial statements.
Verified Answer
JD
Justin DosterMay 19, 2024
Final Answer :
True
Explanation :
When a company issues common stock in exchange for cash, it is considered a financing activity and a cash inflow.
Learning Objectives
- Gain insight into the ramifications of ordinary share activities on financial statements.