An Example of a Non-Cash Investing or Financing Activity That

question 150

Multiple Choice

An example of a non-cash investing or financing activity that is disclosed in a supplementary schedule accompanying the statement of cash flows is:

• A) Recording depreciation expense for the current year.
• B) Declaring, but not paying, dividends on ordinary shares.
• C) Selling land in exchange for a note receivable.
• D) Transferring cash from a checking account into a money market fund.

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Definitions:

Idle Time

Periods when resources, such as machinery or labor, are available but not in use due to lack of work, setup, or maintenance.

Dispatching Rule

A guideline or algorithm used in scheduling to determine the sequence in which work orders should be processed in a manufacturing or service system.

Flow Time

The total time a product or a piece of work requires to move through a production process, from start to finish.

Work-In-Process

Inventory that includes materials that have been released for production but are not yet complete, representing a critical stage in manufacturing and costing processes.