Indicate Where the Event Purchased Land and a Building with a Mortgage

question 39

Multiple Choice

Indicate where the event purchased land and a building with a mortgage would appear, if at all, on the indirect statement of cash flows.

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

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Definitions:

Sole Proprietorship

A Sole Proprietorship is a type of business entity that is owned and run by one individual, with no distinction between the business and the owner, making the owner personally liable for the debts of the business.

Legal Person

An individual or organization capable of bearing legal rights and obligations, including the ability to enter into contracts and sue or be sued.

Corporation

A legal entity recognized by law as a separate entity from its owners, providing limited liability but allowing it to enter into contracts, sue, and be sued.

Sole Proprietor

A business structure where a single individual owns, manages, and bears the responsibilities for all aspects of the business.