The appropriate section in the statement of cash flows for reporting the purchase of land in exchange for ordinary shares is:
A) Operating activities.
B) Financing activities.
C) Investing activities.
D) Schedule of noncash investing or financing activity.
E) Either investing or financing activities.

Question

Quizplus · Accepted Answer

The purchase of land in exchange for ordinary shares is a noncash transaction that does not affect the cash flows directly. Therefore, it is reported in the schedule of noncash investing or financing activities, not in the main sections that reflect cash inflows and outflows.

The Appropriate Section in the Statement of Cash Flows for Reporting