Bonds with a face value of $330,000 are issued at 101. The statement of cash flows would report a cash inflow of:
A)$330,000 in the financing activities section.
B)$333,300 in the financing activities section.
C)$3300 in the financing activities section.
D)$330,000 in the investing activities section.

Question

Quizplus · Accepted Answer

The bonds are issued at 101, which means they are issued at 101% of the face value. Therefore, the cash inflow is 101% of $330,000, which is $333,300, and it is reported in the financing activities section.

Bonds with a Face Value of $330,000 Are Issued at 101