The Following Item Would Be Classified as an Operating Activity

question 1

Multiple Choice

The following item would be classified as an operating activity on the statement of cash flows:

• A)Payments for inventory.
• B)Acquisitions of equipment.
• C)Proceeds from borrowing.
• D)Payments on loans.

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Definitions:

British Pound

The currency of the United Kingdom, used in Great Britain and Northern Ireland.

Uncovered Interest Parity

An economic theory that states the difference in interest rates between two countries equals the expected change in exchange rates between those countries' currencies.

Exchange Rate

The price of one country's currency expressed in another country's currency.

Interest Rates

The proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the loan outstanding.