The Appropriate Section in the Statement of Cash Flows for Reporting

question 30

Multiple Choice

The appropriate section in the statement of cash flows for reporting the purchase of land in exchange for common stock is:

• A) Investing activities.
• B) Reconciliation of cash balance.
• C) Operating activities.
• D) Schedule of noncash investing or financing activity.
• E) Financing activities.

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Definitions:

Merchandise

Goods or products that a retailer buys to sell to consumers, especially in the context of physical goods stocked in a store.

Vouchers Payable

An accounting term referring to an obligation or liability of a company to pay a debt evidenced by a voucher.

Control Features

Mechanisms, policies, or procedures implemented to safeguard assets, ensure accurate and reliable financial data, and promote operational efficiency.

Voucher System

An internal control method in accounting where vouchers are prepared before payments are processed to ensure transactions are authorized and recorded properly.