Asked by Miranda Wilkerson on Jun 09, 2024
Verified
Which of the following statements is false?
A) Investing cash flows include the cash flows associated with lending money to others.
B) Financing cash flows include the cash flows associated with issuing stock and paying dividends.
C) Financing cash flows include the cash flows associated with borrowing and repaying debt excluding short-term bank loans.
D) Investing cash flows include the cash flows associated with buying and selling noncurrent assets.
Financing Cash Flows
This represents the cash flow movements that are associated with financing activities in a company, including transactions involving debt, equity, and dividends.
Investing Cash Flows
These are part of the cash flow statement, showing the cash spent on and generated from investment activities like buying physical assets or securities.
- Recognize the classification of cash flows in the statement of cash flows and their impact on a company's cash position.
Verified Answer
VM
Victor MakoriJun 10, 2024
Final Answer :
C
Explanation :
Financing cash flows indeed include the cash flows associated with borrowing and repaying debt, but this category does not exclude short-term bank loans. Short-term borrowings, like bank loans, are also considered under financing activities in cash flow statements.
Learning Objectives
- Recognize the classification of cash flows in the statement of cash flows and their impact on a company's cash position.