The purchase of fixed assets would appear on the cash flow statement as a:
A) Financing activity
B) Operating activity
C) Investing activity
D) Debt activity

Question

Quizplus · Accepted Answer

The purchase of fixed assets is considered an investing activity as it involves the acquisition of long-term assets that are expected to generate future revenues or cost savings. These assets include buildings, machinery, equipment, and land, among others. Investing activities are reported in the cash flow statement's "Cash Flows from Investing Activities" section, which tracks the inflows and outflows of cash resulting from buying or selling long-term assets, such as property, plant, and equipment or investments in other entities.

The Purchase of Fixed Assets Would Appear on the Cash