Using the Indirect Method
For the following question(s), indicate how each transaction described would be classified on a statement of cash flows if the operating activities section is prepared under the indirect method.
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When using the indirect method, where is the issuing of stock for cash shown on the statement of cash flows?
A) Operating activity
B) Investing activity
C) Financing activity
D) Non cash investing and financing activity

Question

Using the Indirect Method 
For the following question(s), indicate how each transaction described would be classified on a statement of cash flows if the operating activities section is prepared under the indirect method.
-
When using the indirect method, where is the issuing of stock for cash shown on the statement of cash flows?
A) Operating activity
B) Investing activity
C) Financing activity
D) Non cash investing and financing activity

Quizplus · Accepted Answer

Issuing stock for cash is classified as a financing activity because it involves raising capital through equity.