In a statement of cash flows, which of the following items would indicate investing activities?
A) Cash received from taking out longterm loans
B) Interest received from the ownership of financial securities
C) Cash received from the sale of fixed assets
D) Cash from dividends

Question

In a statement of cash flows, which of the following items would indicate investing activities?
A) Cash received from taking out long­term loans
B) Interest received from the ownership of financial securities
C) Cash received from the sale of fixed assets
D) Cash from dividends

Quizplus · Accepted Answer

Cash received from the sale of fixed assets is an example of investing activities in the statement of cash flows. Investing activities refer to the acquisition or disposal of long-term assets and investments, such as property, plant and equipment, and securities. Choice A represents financing activities as long-term loans are a source of financing. Choice B represents operating activities as interest received is a result of day-to-day business operations. Choice D also represents financing activities as dividends are payments made to shareholders, which is a form of financing.

In a Statement of Cash Flows, Which of the Following