In Which Section Would the Purchase of Land for Cash

question 108

Multiple Choice

In which section would the purchase of land for cash be classified on the 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:

Equity

The value of an ownership interest in property, including shareholders' equity in a corporation.

Debt

An amount of money borrowed by one party from another, under the condition that it is to be paid back at a later date, usually with interest.

Financial Risk

The possibility of losing money on an investment or business venture.

ROE

Return on Equity measures a corporation's profitability by revealing how much profit a company generates with the money shareholders have invested.