Royer Corporation engaged in this transaction:
Issued common stock for cash.
Indicate which section,if any,the above transaction would appear in,or relate to,on a statement of cash flows.
A) Operating activities section
B) Does not represent a cash flow
C) Investing activities section
D) Financing activities section

Question

Royer Corporation engaged in this transaction:
 Issued common stock for cash.
Indicate which section,if any,the above transaction would appear in,or relate to,on a statement of cash flows.
A) Operating activities section
B) Does not represent a cash flow
C) Investing activities section
D) Financing activities section

Quizplus · Accepted Answer

The transaction of issuing common stock for cash is a financing activity as it represents an inflow of cash from the issuance of a financing instrument (common stock). As per the statement of cash flows, this transaction will be reported in the financing activities section.

Royer Corporation Engaged in This Transaction