Cash received by borrowing from line of credit will be shown:
A) on the summary cash budget.
B) in the investing activity section of the cash summary budget.
C) on the cash disbursements budget.
D) on the operating activity section of the cash summary budget.

Question

Quizplus · Accepted Answer

Cash received by borrowing from a line of credit is considered a financing activity and would be shown on the summary cash budget, which encompasses all three categories of cash flows (operating, investing, and financing activities). It would not be included in the investing activity section or the cash disbursements budget, as those relate to cash outflows rather than inflows.

Cash Received by Borrowing from Line of Credit Will Be