Financial Accounting > TEST BANK > Fundamentals of Financial Accounting 7th Edition By Phillips, Chlor-Proell, Libby, Libby TEST BANK (All)

Fundamentals of Financial Accounting 7th Edition By Phillips, Chlor-Proell, Libby, Libby TEST BANK

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CHAPTER 1 TRUE/FALSE - Write 'T' if the statement is true and 'F' if the statement is false. 1) Creditors are owners of a corporation. ⊚ true ⊚ false 2) 3) All corporations acquire... financing by issuing stock for sale on public stock exchanges. ⊚ true ⊚ false You paid $10,000 to buy 1% of the stock in a corporation that is now bankrupt. The company owes $10 million dollars to its creditors. As a result of the bankruptcy, you are responsible for paying $100,000 (or $10 million × 1%) of the amount owed to the creditors. ⊚ true ⊚ false 4) flows. 5) 6) Cash paid for wages is an example of an operating activity on the statement of cash ⊚ true ⊚ false Borrowing money from a bank is a financing activity on the statement of cash flows. ⊚ true ⊚ false The daily business activities involved in running a business, such as buying supplies and paying salaries and wages, are classified as operating activities on the statement of cash flows. ⊚ true ⊚ false [Show More]

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