Which of the following statements is true?
A) The corporation will have cash inflow when bonds are issued for an amount equal to, greater than, or less than the par value of the bonds.
B) The corporation will have an outflow of cash connected to an investing activity when interest is paid to bond investors.
C) The corporation will have to pay cash to bond investors when those investors demand to call the bonds.
D) An outflow of cash when convertible bonds are converted is a financing activity.

Question

Quizplus · Accepted Answer

When a corporation issues bonds, it receives cash inflow regardless of whether the bonds are issued at par, premium, or discount.

Which of the Following Statements Is True