The category of cash flows that creates revenues, expenses, gains, and losses is:

Question

Quizplus · Accepted Answer

Operating activities involves cash inflows and outflows related to the main business operations of the company, including revenue and expenses from sales and purchases of inventory, payment to employees, payment of taxes, payment to suppliers etc. This category includes all transactions that are not related to investing or financing activities. Therefore, revenues, expenses, gains, and losses fall under operating activities. Financing activities are related to cash inflows and outflows from sources such as borrowing or repaying loans, issuing or buying back stock, or paying dividends. Investing activities are related to cash inflows and outflows from acquiring or disposing of long-term assets such as property, plant, and equipment, or investments in securities other than cash equivalents.

The Category of Cash Flows That Creates Revenues, Expenses, Gains