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Harlowe Corp, a private company reporting under ASPE, engaged in the following transactions. For each transaction, indicate where, if at all, it would be classified on the statement of cash flows.
-Purchase of land and building with a mortgage:
A)Operating activities section
B)Investing activities section
C)Financing activities section
D)Does not represent a cash flow

Question

Use the following information for questions 
Harlowe Corp, a private company reporting under ASPE, engaged in the following transactions. For each transaction, indicate where, if at all, it would be classified on the statement of cash flows.
-Purchase of land and building with a mortgage:
A)Operating activities section
B)Investing activities section
C)Financing activities section
D)Does not represent a cash flow

Quizplus · Accepted Answer

The purchase of land and building with a mortgage does not involve an immediate cash outflow, as it is financed through a mortgage. Therefore, it does not represent a cash flow in the statement of cash flows.

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