Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

13. Statement of Cash Flows

Introduction to the Statement of Cash Flows

Financial Accounting

13. Statement of Cash Flows

Introduction to the Statement of Cash Flows

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Multiple Choice

In which section of the statement of cash flows would the cash received from the sale of equipment be reported?

Supplemental disclosures

Investing activities

Financing activities

Operating activities

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Verified step by step guidance

Understand the purpose of the statement of cash flows: It categorizes cash inflows and outflows into three main sections—operating activities, investing activities, and financing activities.

Review the definition of investing activities: These include transactions involving the acquisition or disposal of long-term assets, such as property, plant, and equipment.

Identify the nature of the transaction: The sale of equipment is a disposal of a long-term asset, which falls under investing activities.

Consider the cash flow impact: Cash received from the sale of equipment represents an inflow of cash, which is reported in the investing activities section.

Supplemental disclosures are not a section of the statement of cash flows but provide additional information about non-cash transactions or other relevant details. Therefore, the correct section for this transaction is investing activities.