Which of the Following Transactions Would Be Shown in the Non-Cash

question 79

Multiple Choice

Which of the following transactions would be shown in the non-cash investing and financing activities section of the cash flow statement?

• A)Sold equipment with book value of $4 000 in exchange for $1 000 cash and a $3 000 bill
• B)Issued 10 000 shares at $5 per share
• C)Purchased land for a $20 000 deposit and a mortgage payable of $180 000
• D)Settled a long-term bill payable by issuing ordinary shares

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Definitions:

Cash Budget

A financial plan that estimates cash inflows and outflows over a specific period, often used to assess liquidity and cash requirements.

Financing Section

A part of the cash flow statement that shows the net flows of cash used to fund the company’s capital expenditures and financial investments.

Budgeted Income Statement

The Budgeted Income Statement is a financial forecast that projects a company’s revenues, expenses, and net income for a specific period.

Accrual Basis

An accounting method where revenue and expenses are recorded when they are earned or incurred, regardless of when cash is exchanged.