Harlowe Corp, a Private Company Reporting Under ASPE, Engaged in the Following

question 61

Multiple Choice

Harlowe Corp, a private company reporting under ASPE, engaged in the following transactions. For each transaction, indicate where, if at all, it would be classified on the statement of cash flows. Assume the indirect method is used. Increase in merchandise inventory:

• A)Operating activities section
• B)Investing activities section
• C)Financing activities section
• D)Does not represent a cash flow

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Definitions:

Electronic Repair Revenues

Income generated from services related to fixing electronic devices.

Expenses

Costs incurred in the process of earning revenue, typically reflected in the income statement to calculate net income.

Financial Information

Data relating to the financial status, performance, and changes in financial position of an entity.

Revenues

The cumulative income derived from transactions involving goods or services tied to the main business functions.