The following are cash flow transactions for Mungo LtD. Which of the following combinations include all of the given answers transactions that will determine cash flows from operating activities of Mungo Ltd that is in accordance with AASB 107 "Cash Flow Statements"?

Question

The following are cash flow transactions for Mungo LtD.  Which of the following combinations include all of the given answers transactions that will determine cash flows from operating activities of Mungo Ltd that is in accordance with AASB 107 "Cash Flow Statements"?

Quizplus · Accepted Answer

According to AASB 107, cash flows from operating activities include cash inflows and outflows from transactions that relate to the core operations of the business. Transaction V is related to the purchase of a non-current asset, which is not considered an operating activity. Transaction VI is related to borrowing, which is a financing activity. Therefore, options A and B can be eliminated. Option D excludes transaction IV, which is related to cash paid for wages and salaries, which is an operating activity. Thus, the best choice is option C, which includes all the transactions related to operating activities.

The Following Are Cash Flow Transactions for Mungo LtD