Asked by Ashlee Tennell on Jul 05, 2024
Verified
An example of an investing activity is:
A) Paying wages of employees.
B) Cash dividends paid.
C) Purchase of land.
D) Selling inventory.
E) Stockholder investments.
Investing Activity
Financial activities related to acquiring or disposing of non-current assets, such as property, plant, and equipment, which are recorded on a company's cash flow statement.
Cash Dividends
Dividends paid by a company to its shareholders in the form of cash.
Purchase Of Land
The acquisition of land for business operations or investment, recorded as a fixed asset in the company's balance sheet.
- Distinguish between different types of business activities: operating, investing, and financing.
Verified Answer
CR
Cristina ReneeJul 10, 2024
Final Answer :
C
Explanation :
The purchase of land is an investing activity because it involves the acquisition of a long-term asset that is expected to generate future economic benefit for the company. The other options listed either relate to operating activities (A and D) or financing activities (B and E).
Learning Objectives
- Distinguish between different types of business activities: operating, investing, and financing.