In a statement of cash flows, which of the following events would be classified as a financing activity?
A) purchase of a trading security
B) payment of interest on a loan
C) payment of cash dividends to shareholders
D) all of these

Question

Quizplus · Accepted Answer

Payment of cash dividends to shareholders is a financing activity because it involves the distribution of funds to the company's owners/shareholders, which is a characteristic of financing activities. Purchasing a trading security would be classified as an investing activity, and payment of interest on a loan would be classified as an operating activity.

In a Statement of Cash Flows, Which of the Following