Use the Following Codes to Indicate How the Cash Flow

question 36

Multiple Choice

Use the following codes to indicate how the cash flow effect, if any, of each transaction or event would be reported on a statement of cash flows if the operating activities section is prepared using the indirect method. (Choices may be used more than once.)
-issued a twenty-year mortgage note for cash

• A)operating activity-add to net income
• B)operating activity-deduct from net income
• C)inflow from investing activity
• D)outflow from investing activity
• E)inflow from financing activity
• F)outflow from financing activity
• G)noncash investing and financing activity
• H)not reported on statement of cash flows

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Definitions:

Gross Negligence

An act committed with extreme reckless disregard for the property or life of another person.

Bailee

A person or entity that temporarily holds property belonging to another under a bailment agreement, usually for a specific purpose.

Common Carriers

Companies that provide transportation services to the general public under license or authority provided by a regulatory body.

Transportation Services

The sector or services involved in the movement of goods and individuals from one location to another.