Asked by Jordyn Orrison on May 14, 2024
Verified
A purchase of land in exchange for a long-term note payable must be disclosed as a noncash investing and financing activity.
Noncash Investing
Transactions involved in investing activities that do not involve immediate cash flow, such as exchanging one asset for another.
Financing Activity
Activities that result in changes in the size and composition of the equity capital and borrowings of the company.
- Comprehend the reporting necessities for noncash investment and financing activities.
Verified Answer
LP
Leticia PerezMay 15, 2024
Final Answer :
True
Explanation :
A purchase of land in exchange for a long-term note payable is a noncash transaction and would be disclosed as a noncash investing and financing activity in the statement of cash flows.
Learning Objectives
- Comprehend the reporting necessities for noncash investment and financing activities.