Noncash investing and financing activities may be disclosed in:

Question

Quizplus · Accepted Answer

Noncash investing and financing activities, such as issuance of stock, conversion of debt to equity, and acquisition of assets through assumed liabilities, do not involve cash inflows or outflows. Therefore, such activities are not reported in the operating, investing, or financing activities sections of the statement of cash flows. Instead, they are disclosed in a note or schedule attached to the financial statements or the statement of cash flows to provide additional information about the transactions and their impact on the company's financial position and performance. This disclosure helps users to assess the company's ability to generate cash in the future, its financing and investing strategies, and the risks and uncertainties associated with its operations.

Noncash Investing and Financing Activities May Be Disclosed In