Which type of cash flows are share repurchases (e.g., treasury stocks)?

Question

BlackTom AI · Accepted Answer

When evaluating the nature of share repurchases, it helps to recall how cash flow categories are defined in financial reporting.
Option 1: Investing Cash Flows. This category covers purchases and sales of long-term assets like property, plant, equipment, or investments. Share repurchases are not about acquiring or selling operating assets or investments, so this is not correct.
Option 2: No cash flows involved in share repurchases. In reality, repurchasing shares involves cash going out of the company to buy back its own stock, so this statement misrepresents the cash impact and is incorrect.
Option 3: Operating Cash Flows. These reflect cash effects of core business operations, such as receipts from customers and payments to suppliers. Treasury stock activity does not relate to day-to-day operating activities, making this option inaccurate.
Option 4: Financing Cash Flows. This category includes transactions with equity and debt, such as issuing or repurchasing stock, paying dividends, or taking on debt. Share repurchases reduce cash and are financed through equity financing activities, so this is the correct classification.
Thus, among the choices, the only one that aligns with how share repurchases are categorized in the cash flow statement is Financing Cash Flows.

Which type of cash flows are share repurchases (e.g., treasury stocks)? 单项选择题

类似问题

Other things held constant, which of the following actions would increase the amount of cash on a company's balance sheet? 在其它条件不变的情况下，以下哪项行动会增加公司资产负债表上的现金？

Is the following statement true or false? In the products of methylation-hydrolysis, every -OH group corresponds to the position of a glycosidic bond in the starting polysaccharide.

Which of the follwoing structures represents amylopectin?

Which of the following is true about an aldopentose?I. It is a monosaccharide.II. It contains a CHO groupIII. It is a disaccharide.IV. It is an oligosaccharide.

For stock A, we have 𝛽 𝑖 = 0.70. Suppose the expected market risk premium next year is 9% and the risk-free rate is 3%. What is the expected return of this stock based on the CAPM? (Please answer in % and round to 2 decimal places. If the answer is 8.057%, then in the box, write 8.06)

更多留学生实用工具

智能学习助手

风格化写作助手

论文查重助手

文献引用助手

课堂转译助手

课堂笔记助手

Quiz搜索助手

学校历年真题

智能刷题助手

智能匹配练习

希望你的学习变得更简单