The issuance of common shares in exchange for a building would appear both as a cash inflow in the financing activities section of the cash flow statement and also as a cash outflow in the investing activities section.

Question

Quizplus · Accepted Answer

Issuing common shares in exchange for a building would not result in a cash inflow or outflow, as no cash is actually exchanged. Instead, it would be recorded as a non-cash transaction and would only be reported in the financing and investing sections if the building meets the criteria to be recorded on the balance sheet as an investing activity.

The Issuance of Common Shares in Exchange for a Building