Answer:
The company issued common stock for $250,000. Management expects to use the proceeds to purchase land next year.
- Cash flows from financing activities increased by $250,000. Cash flows from investing activities are not affected during this year (they should decrease next year).
A new office building was purchased by issuing a $700,000 long-term note payable to the seller.
- Cash flows from financing activities increased by $700,000. Cash flows from investing activities decrease by $700,000.
A-2-Z acquired equipment from one of its suppliers. In exchange, A-2-Z offers to provide design services to its supplier over the next two years. The services are valued at $90,000.
- Cash flows from financing and investing activities are not affected since this transaction is part of operating activities.
It's appropriate if it's cited and used as an example or prompt.
9 Letter C 8 c 7 d 6 a 8 b
Investors at Penny's candies have low expectations from the company since it has a very low P/E ratio. Either the company is not performing well or investors have discounted some bad news in future cash flows.
Whereas Donna's confections has a P/E of 6.7 which is much better than that of Penny's. So here the company is performing well and investors are positive on future good news and they expect the cash flows to improve and hence the stock rules at a higher P/E ratio
