A transaction of issuance of stock in exchange for equipment would be recorded as a(n):
A)operating activity.
B)investing activity.
C)financing activity.
D)noncash investing and financing activity.

Question

Quizplus · Accepted Answer

This transaction is a noncash investing and financing activity because it involves acquiring an asset (equipment) through a financing method (issuance of stock), which does not involve cash flows but still affects the investing and financing position of the company.

A Transaction of Issuance of Stock in Exchange for Equipment