Use the Following Codes to Indicate How the Cash Flow

question 160

Multiple Choice

Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method. (Choices may be used more than once.)
-paid interest on a capital lease

• A)inflow from operating activity
• B)outflow from operating activity
• 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:

Old Northwest

A historical term referring to the territory north of the Ohio River and east of the Mississippi River that was the frontier of the United States in the late 18th and early 19th centuries.

Mason-Dixon Line

A demarcation line originally surveyed in the 1760s that came to symbolize the cultural boundary between the Northern and Southern United States.

Railroad Industry

The sector of the economy involved in the operation of trains and the management of train transportation.

Coal Mining

The process of extracting coal from the ground, which has historically been a major industry in various parts of the world, including the United States and the United Kingdom.