IDENTIFICATION, 2 pointe ench dentity what type of activity, operatino, Investin
ID: 2541492 • Letter: I
Question
IDENTIFICATION, 2 pointe ench dentity what type of activity, operatino, Investino, or oanoino, ouch of the tollowing would be classified as on a statoment of oash flown by placino the approprinte letter in the blank beakle the activity Uso O for operatino aoivity , ror invest ng activity, nndfo' rinanoing r")"vity 1 isaued bond sold a building purchased 30% of another company's oommon stock 3. -4, had a decrease in account, payab'n 5. re-paid a loan 6. prchased treasury stook 7. Issued preferred stock 8. net income 9 10. purchased equipment paid cash dividendaExplanation / Answer
Operating Activities : Cash flow from operating activities includes the amount of money a company brings in from ongoing, regular business activities, such as manufacturing and selling goods or providing a service.
Investing Activities : It includes cash flows related to investments in the financial markets and operating subsidiaries and investment in capital assets such as plant and equipment.
Financing Activities : It includes cash flows related to raising capital, repaying investors, adding or changing loans and issuing more stock.
1) Issue Bonds = It is an Financing Activity (F)
2) Sold a Building = It is an Investing Activity (I)
3) Purchased 30% of another company's common stock = It is an Investing Activity (I)
4) Had a decrease in accounts payable = It is an Operating Activity (O)
5) Re-paid a loan = It is a Financing Activity (F)
6) Purchased Treasury Stock = It is a Financing Activity (F)
7) Issued Preferred Stock = It is a Financing Activity (F)
8) Net Income = It is an Operating Activity (O)
9) Paid cash dividends = It is a Financing Activity (F)
10) Purchased Equipment = It is an Investing Activity (I)