Which of the following would be classified as financing cash flows on a statement of cash flows?
1.Paying cash dividends.
2.Lending cash to others.
3.Issuing stock for cash.
4.Purchasing long-term assets for cash.

Question

Which of the following would be classified as financing cash flows on a statement of cash flows? 
1.Paying cash dividends.
2.Lending cash to others.
3.Issuing stock for cash.
4.Purchasing long-term assets for cash.

Quizplus · Accepted Answer

Financing cash flows involve activities that affect the long-term liabilities and equity of the company. Paying cash dividends reduces equity, while issuing stock for cash increases it. Lending cash to others does not directly affect long-term liabilities and equity but rather involves investing activities. Purchasing long-term assets for cash falls under investing activities as it involves investing in assets that will generate future income for the company.

Which of the Following Would Be Classified as Financing Cash