Which of the following is considered a financing activity and a source of cash on the statement of cash flows?
A)Purchase of treasury stock
B)Sale of land
C)Borrowing on a long-term basis
D)Payment from customers

Question

Quizplus · Accepted Answer

Borrowing on a long-term basis is considered a financing activity because it involves obtaining funds from external sources to finance the company's operations, and it is a source of cash because it increases the company's cash balance.

A, B, and D are not financing activities: 
A) Purchase of treasury stock is a use of cash and falls under the category of investing activities.
B) Sale of land is also a use of cash and also falls under the category of investing activities.
D) Payment from customers is a receipt of cash and falls under the category of operating activities.

Which of the Following Is Considered a Financing Activity and a Source