In the context of a firm's statement of cash flows, ________ activities include cash raised during the period by borrowing money or selling stock and/or cash used during the period by paying dividends, buying back outstanding stock, or buying back outstanding bonds.
A) investing
B) financing
C) operating
D) liquidity
E) capital

Question

Quizplus · Accepted Answer

Financing activities involve cash flows related to the firm's financing, such as issuing stock, borrowing, paying dividends, or buying back stock or bonds. Investing activities relate to the purchase or sale of long-term assets, while operating activities involve the daily operations of the business. Neither liquidity nor capital are categories of activities in the statement of cash flows.

In the Context of a Firm's Statement of Cash Flows