The purchase of $100,000 of equipment by issuing a note would be reported:
A)as a $100,000 investing inflow,and a $100,000 financing outflow.
B)as a $100,000 investing outflow,and a $100,000 financing inflow.
C)as a $100,000 operating inflow,and a $100,000 financing outflow.
D)in a supplementary schedule.

Question

Quizplus · Accepted Answer

All companies are required to report material investing and financing transactions that did not have cash flow effects (called noncash investing and financing activities).The purchase of equipment by issuing a note is a noncash investing and financing transaction.This information is normally presented for users in a supplementary schedule to the statement of cash flows or in the financial statement notes.

The Purchase of $100,000 of Equipment by Issuing a Note