P Corp. leased an asset to L Corp. using an operating lease in February of Year 1. P Corp.'s statement of cash flows for the year ending December 31, Year 1 will report:
A) A cash outflow from investing activities.
B) A cash outflow from financing activities.
C) A cash inflow from operating activities.
D) No cash outflow.

Question

Quizplus · Accepted Answer

In a statement of cash flows for the lessor, rent payments for operating leases generally are reported as inflows from operating activities.

P Corp Leased an Asset to L Corp