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Ingles Corp., a private company reporting under ASPE, engaged in the following transactions.For each transaction, indicate where, if at all, it would be classified on the statement of cash flows.
-Repurchase of Ingles' own common shares on the open market:
A)operating activities section
B)investing activities section
C)financing activities section
D)does not represent a cash flow

Question

Use the following information for questions 
Ingles Corp., a private company reporting under ASPE, engaged in the following transactions.For each transaction, indicate where, if at all, it would be classified on the statement of cash flows.
-Repurchase of Ingles' own common shares on the open market:
A)operating activities section
B)investing activities section
C)financing activities section
D)does not represent a cash flow

Quizplus · Accepted Answer

Repurchase of own common shares is classified as a financing activity as it involves the use of cash to reduce the number of outstanding shares, which in turn increases the value of remaining shares.

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