Question

What can every transaction affecting cash can be classified as? a. Operating, Investing, or Expenditure b....

What can every transaction affecting cash can be classified as?

a. Operating, Investing, or Expenditure

b. Operating, Resource, or Expenditure

c. Non-operating, Investing, or Financing

d. Operating, Investing, or Financing

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Answer #2

Every transaction affecting cash can be classified as Operating, Investing or financing. Operating includes all the cash transactions related to the Operation of the company such as changes in account receivable or account payable.

Investing includes all the transaction which either increases the investment or reduces the investment of the company. For example any purchase or sale of equipment or any other asset will be included in investing.

Financing includes all those transaction which are related to the finance of the company. For example issue of new shares for repayment of any long-term borrowing will be classified under of financing .

Therefore the correct option is D

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answered by: anonymous
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