Only from f to j

5. True or False Please use T or F to indicate if each statement is true or false. T or F a. Par value is an arbitrary amount set by the company for each share of | Stockholders' equity on the balance sheet is accounted for at current b. market value. A re-issuance of treasury stock has the potential to yield a gain or loss on the income statement. One reason a company may repurchase stock is because it wants to d. send a signal to the market that its shares are undervalued. Most companies use the direct method for disclosing their cash flows e. from operating activities rather than the indirect method. When a company purchases equipment using common stock, the equipment purchase is reported as cash flow from financing activities in the statement of cash flows. An advantage of issuing a bond relative to stock is that the bond interest payments are tax deductible. f. 9. h Increases in the market rate of interest subsequent to a bond issuance increase the discount on the bond. Amortization of discount on bonds payable will make the amount of interest expense less than the cash coupon payment for that year. A contingent liability is disclosed in a note to the financial statements when the liability is reasonably possible and can be estimated