Which of the following describes the effects of a claims exchange transaction on a company's financial statements?
A) Option A
B) Option B
C) Option C
D) Option D

Question

Which of the following describes the effects of a claims exchange transaction on a company's financial statements? 
A) Option A 
B) Option B 
C) Option C 
D) Option D

Quizplus · Accepted Answer

A claims exchange transaction involves the exchange of one claim for another, typically with a different party. This transaction would not have a direct impact on a company's financial statements because there is no new cash or assets coming into or going out of the company. Therefore, options A, B, and D, which describe changes to cash, inventory, and revenue, respectively, are not relevant to a claims exchange transaction. Option C, which states that the transaction would not affect the financial statements, is the correct choice. Note that there may be indirect impacts on financial statements if the new claim has different terms or values than the original, but these would be reflected in subsequent accounting periods.

Which of the Following Describes the Effects of a Claims