Which of the Following Statements Is Correct in Accordance with AASB

question 29

Multiple Choice

Which of the following statements is correct in accordance with AASB 107 "Cash Flow Statements"??

• A) Cash repayments of amounts borrowed are classified under financing activities.
• B) Cash proceeds from issuing equity instruments are classified under financing activities.
• C) Cash payments to acquire property, plant and equipment are classified under investing activities.
• D) Cash advances and loans made to other parties are classified under investing activities.
• E) Conversion from debt to equity is classified under operating activities.

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Definitions:

Written Agreement

A formalized record of a contract between parties, detailing the terms and conditions of their arrangement.

Secured Party

A secured party is an individual or entity that holds an interest in a debtor's collateral to secure payment or performance of an obligation.

Financing Statements

Legal documents filed to indicate a security interest in personal property, used to perfect a lender's claim against borrowers' assets.

Secured Interest

A legal claim or lien on collateral that has been pledged by a borrower to secure payment of a debt.