Which of the following would be classified as a financing activity on the statement of cash flows?
A)Cash receipts from accounts receivable collections.
B)Cash receipts from sale of equipment.
C)Cash paid to purchase treasury stock.
D)Cash receipts from short-term notes receivable.

Question

Quizplus · Accepted Answer

Cash paid to purchase treasury stock is a financing activity as it involves the company using its cash to buy back its own shares from the shareholders, which reduces the amount of outstanding shares and increases earnings per share.

Which of the Following Would Be Classified as a Financing