An example of a noncash transaction on the statement of cash flows is the purchase of equipment with a long-term note payable.

Question

Quizplus · Accepted Answer

A noncash transaction on the statement of cash flows involves activities that do not directly impact cash flow, such as the purchase of equipment with a long-term note payable. This transaction involves obtaining equipment in exchange for a promise to pay over a period of time, and therefore does not involve an immediate exchange of cash.

An Example of a Noncash Transaction on the Statement of Cash