Following Are Cash Flow Transactions for Cootamundra Ltd

question 1

Multiple Choice

Following are cash flow transactions for Cootamundra Ltd.

Which of the following combinations include all transactions that may by classified under investing activities of Cootamundra Ltd that is in accordance with AASB 107 "Cash Flow Statements"?

• A) I, II, III, IV, V and VI;
• B) I, II, IV and V;
• C) III, IV and VI;
• D) I, II and V;
• E) II, IV and V.

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Definitions:

Recessionary Gaps

A situation in macroeconomics where the real GDP is lower than the potential GDP, indicating underutilized resources and less-than-full employment in the economy.

Inflationary Gaps

Situations where the demand for goods and services exceeds the production capacity of the economy, leading to an upsurge in price levels.

Classical Economists

A group of economists in the 18th and 19th centuries who believed in free markets, the self-regulating nature of economies, and the importance of competition.

Inflation

A measure of the rate at which the general level of prices for goods and services is rising, leading to a decrease in the purchasing power of money.