The purchase of treasury stock would be reported on a statement of cash flows as a:
A)cash inflow under the operating activities.
B)cash outflow under the financing activities.
C)cash inflow under the investment activities.
D)cash inflow under the financing activities.

Question

Quizplus · Accepted Answer

The purchase of treasury stock is considered a financing activity because it involves the use of funds to buy back shares of its own stock. This would result in a cash outflow under the financing activities section of the statement of cash flows.

The Purchase of Treasury Stock Would Be Reported on a Statement