General Motors decides to close one of its manufacturing plants in the Midwest. GM sells the facility to a new foreign automobile manufacturer. The money GM receives from this sale would belong in the ____ section of the statement of cash flows.
A) operating
B) investing
C) business
D) selling
E) financing

Question

Quizplus · Accepted Answer

The money received from the sale of a manufacturing plant would belong in the investing section of the statement of cash flows, as it represents a significant investment activity. The operating section deals with the company's day-to-day, routine operations, while the selling section would include revenues from the company's primary products or services. The financing section includes activities such as issuing or repurchasing stocks, bonds, and other forms of financing. Therefore, the investing section is the best choice for this scenario.

General Motors Decides to Close One of Its Manufacturing Plants