Question

(TCO C) For each item listed below, indicate which section (category) of the Statement of Cash Flows should contain that item, AND also state whether the item would result in an inflow or outflow of cash. Recall that the three sections (categories) are Operating, Investing, and Financing. (30 points)

(a) Sold a building that had been used by the company for operations
(b) Retired bonds at the end of the term
(c) Purchased land with cash
(d) Purchased raw materials for production
(e) Issuance of common stock

Answer 1

Classification :

No	Transaction	Category	Inflow/outflow
a.	Sold a building that had been used by the company for operations	Cash flow from investing activities	Inflow
b	Retired bonds at the end of the term	Cash flow from financing activities	Outflow
c	Purchased land with cash	Cash flow from investing activities	Outflow
d	Purchased raw materials for production	Cash flow from operating activities	Outflow
e	Issuance of common stock	Cash flow from financing activities	Inflow