Which of the following transactions is a significant noncash investing and financing activity?
A)Land is purchased for cash.
B)Bonds are issued for cash.
C)Cash equivalents are purchased.
D)Equipment is acquired by issuing a long-term note.

Question

Quizplus · Accepted Answer

Acquiring equipment by issuing a long-term note is a significant noncash investing and financing activity because it involves a non-cash transaction (issuing a note instead of paying cash) for a long-term investment (acquiring equipment). The other choices involve cash transactions (purchasing land for cash, issuing bonds for cash, and purchasing cash equivalents).

Which of the Following Transactions Is a Significant Noncash Investing