When preparing the statement of cash flows using the indirect method,the purchase of equipment would appear as
A) a use of cash in the investing activities section
B) a source of cash in the investing activities section
C) a use of cash in the financing activities section
D) a source of cash in the financing activities section

Question

Quizplus · Accepted Answer

The purchase of equipment is a capital expenditure and is considered an investing activity. As per the indirect method, it is shown as a use of cash in the investing activities section of the statement of cash flows.

When Preparing the Statement of Cash Flows Using the Indirect