Which of the following should be shown on a statement of cash flows under the financing activity section?
A) The purchase of a long-term investment in the common stock of another company
B) The payment of cash to retire a long-term note
C) The proceeds from the sale of a building
D) The issuance of a long-term note to acquire land

Question

Quizplus · Accepted Answer

B) The payment of cash to retire a long-term note is a financing activity because it involves the company's management of its long-term liabilities and equity. Financing activities include transactions related to borrowing from and repaying debt to creditors, and transactions with the company's owners, such as issuing and repurchasing shares.

Which of the Following Should Be Shown on a Statement