Indicate the Section (Operating Activities, Investing Activities, Financing Activities, or None)

question 81

Essay

Indicate the section (operating activities, investing activities, financing activities, or none) in which each of the following would be reported on the statement of cash flows prepared by the indirect method:

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Definitions:

Indemnity

Indemnity is a contractual obligation of one party to compensate the loss occurred to the other party due to the acts of the indemnitor or any other party.

Guarantor

A guarantor is a person or entity that agrees to be responsible for another's debt or obligations, should the original party fail to meet their responsibilities.

Guarantee

A formal promise or assurance, typically in writing, that certain conditions will be fulfilled, especially that a product will be repaired or replaced if not of a specified quality.

Statute of Frauds

A legal concept that requires certain types of contracts to be in writing and signed by the party to be charged, in order to be legally enforceable.