Major investing and financing activities that do not involve cash do not have to be reported on the statement of cash flows.

Question

Quizplus · Accepted Answer

The statement of cash flows is designed to show the inflows and outflows of cash for an organization during a specific period of time. Major investing and financing activities that do not involve cash, such as the issuance of stock or the exchange of assets for other assets, also need to be reported on the statement of cash flows using non-cash transaction disclosures.

Major Investing and Financing Activities That Do Not Involve Cash