Which of the following is reported as an operating activity on the statement of cash flows?

Question

Quizplus · Accepted Answer

Cash payments for income taxes are reported as an operating activity on the statement of cash flows. Operating activities include cash receipts and payments related to the day-to-day operations of the business, such as sales, purchases of inventory, and payments to employees and suppliers. Income taxes are considered an ongoing expense of the business and therefore, the cash payments for income taxes are reported as an operating activity.

B, C, and D are not reported as operating activities. Cash received from the collection of long-term notes receivable is reported as an investing activity, cash paid for dividends to stockholders is reported as a financing activity, and cash proceeds from issuing long-term debt is also reported as a financing activity on the statement of cash flows.

Which of the Following Is Reported as an Operating Activity