Which of the following transactions would not be reported within the financing activities section of the cash flow statement?
A)The payment of a cash dividend.
B)An issue of preferred stock in exchange for cash.
C)An issue of common stock in order to retire a bond liability.
D)The payment of cash to acquire shares of common stock to be held as treasury stock.

Question

Quizplus · Accepted Answer

An issue of common stock in order to retire a bond liability would not be reported within the financing activities section of the cash flow statement. This is because it involves a transaction between equity and debt, and as such, it would be reported in both the financing and investing activities sections of the statement. The other options, such as the payment of a cash dividend, an issue of preferred stock, and the payment of cash to acquire treasury stock, are all activities that strictly involve financing and would therefore be reported within that section of the cash flow statement.

Which of the Following Transactions Would Not Be Reported Within