Question

Which of the following represents an inflow of cash and therefore would be reported on the statement of cash flows?

Select one:

a. acquiring of treasury stock

b. issuing long-term debt

c. declaring stock dividends

d. retiring of bond payable

A five-year bond was issued at par for $640,000 cash. This transaction should be shown on a statement of cash flows under

Select one:

a. noncash activities

b. operating activities

c. financing activities

d. investing activities

Which of the following is a noncash investing and financing activity?

Select one:

a. issuing common stock in exchange for land

b. payment of a cash dividend

c. buying of merchandise inventory on account

d. payment of a 10-month note payable

Answer 1

1. Option B Issuing a longterm debt is shown as inflow under financing activities
2. Option C Issuance of bond is shown as inflow under financing activities
3. Option C Merchandise inventory purchase is shown generally under operating activities.