A business bought some land for future expansion at a cost of $100,000 and paid for it in full by issuing additional shares of capital stock.This will be reported in which section(s)of the cash flow statement?
A) Only in the investing activities section.
B) Only in the financing activities section.
C) In both the investing activities and financing activities sections.
D) It will not be reported in either the investing activities or the financing activities section.

Question

Quizplus · Accepted Answer

The transaction involves issuing shares, which is a non-cash financing activity, and purchasing land, which is a non-cash investing activity. Since no cash is involved, it is not reported in the cash flow statement.

A Business Bought Some Land for Future Expansion at a Cost