In preparing a statement of cash flows, a conversion of bonds into ordinary shares will be reported in
A) the financing section.
B) the operating section.
C) a separate note or supplementary schedule to the financial statements.
D) the equity section.

Question

Quizplus · Accepted Answer

A conversion of bonds into ordinary shares is a non-cash financing activity and is reported in a separate note or supplementary schedule to the financial statements, not in the main sections of the cash flow statement.

In Preparing a Statement of Cash Flows, a Conversion of Bonds