In a Statement of Cash Flows, Payments to Acquire Debt

question 16

Multiple Choice

In a statement of cash flows, payments to acquire debt instruments of other entities (other than cash equivalents) should be classified as cash outflows for

• A) operating activities.
• B) investing activities.
• C) financing activities.
• D) lending activities.

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Definitions:

Rent of Factory

The periodic payment made for the use of a factory facility or space for manufacturing or production processes.

Kitchen Manufacturer

A company or enterprise specializing in the production of kitchen units, appliances, and related items.

Engineered Cost

Costs that can be specifically traced and directly associated with certain activities or projects without ambiguity.

Direct Materials

Raw materials that are directly used in the manufacturing of a product and can be directly attributed to the product itself.