If no cash was exchanged in the purchase of equipment financed entirely with a note payable,we represent this as both an investing activity and a financing activity in the statement of cash flows.We represent this as a noncash activity either directly after the cash flow statement or in a note to the financial statements.

Question

Quizplus · Accepted Answer

In the statement of cash flows, noncash transactions like purchasing equipment with a note payable are not included in the cash flow sections but are disclosed in a separate schedule or note to the financial statements.

If No Cash Was Exchanged in the Purchase of Equipment