If non-cash investing and financing activities are part cash and part non-cash, which of the following is true?

Question

Quizplus · Accepted Answer

Companies should report the non-cash component in a separate note and report the cash portion on the statement of cash flows to provide transparency and clarity to stakeholders. Ignoring the non-cash component would not accurately represent the company's financial activities, and deducting the cash equivalent of the non-cash component would not present a clear picture of the company's cash flows. Therefore, the best choice is to report the cash portion on the statement of cash flows and the non-cash component in a separate note.

If Non-Cash Investing and Financing Activities Are Part Cash and Part