Question

Cash flows from investing activities include: A) changes in Accounts Receivable. B) sale of land. C)...

  1. Cash flows from investing activities include:

A) changes in Accounts Receivable.

B) sale of land.

C) paying principal to lenders.

D) cash dividends paid.

Homework Answers

Answer #1

A) Changes in Accounts Receivables - This item is included in cash flows from operating activities. Any increase in accounts receivable is deducted and any decrease in accounts receivable is added to the net income to calculate the cash flows from operating activities.

B) Sale of land - Proceeds from the sale of land is considered an inflow in the cash flows from investing activities section of the statement of cash flows.

C) Paying dividends to lenders - This will be considered an outflow in the cash flows from financing activities section of the statement of cash flows.

D) Cash dividends paid - This will be considered an outflow in the cash flows from financing activities section of the statement of cash flows.

Hence, option B i.e. sale of land is the correct answer.

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