Which of the following statements is false?
A) A share dividend has no impact on cash.
B) Issuance of preferred shares would increase cash from financing activities.
C) Repurchases of shares at prices lower than the average issue price result in profit for the issuing company because they are capital transactions, not operating transactions.
D) Repurchase of shares (treasury shares) and payment of cash dividends reduce cash flow from financing activities.

Question

Quizplus · Accepted Answer

Repurchases of shares at prices lower than the average issue price do not result in profit for the issuing company; they are capital transactions and do not affect the income statement.

Which of the Following Statements Is False