Items classified as 'financing activities' on an entity's Statement of Cash Flows are usually associated with:
A) movements in non-current liabilities and equity;
B) sales of goods and services by the entity;
C) disposal of non-current assets;
D) purchase of shares by the entity.

Question

Quizplus · Accepted Answer

Financing activities refer to activities that involve acquiring or repaying funds to finance the entity's operations. These activities involve non-current liabilities (such as long-term loans and bonds) and equity (e.g. issuing or buying back shares). Therefore, the best choice is A, movements in non-current liabilities and equity. The other choices (B, C, and D) are associated with operating and investing activities.

Items Classified as 'Financing Activities' on an Entity's Statement of Cash