Which of the following is NOT classified as an investing activity?

Question

BlackTom AI · Accepted Answer

To begin, this question asks us to identify which item is not classified as an investing activity in the statement of cash flows.

The provided answer indicates: d. Obtaining a loan from another entity. This choice is aligned with the standard classification: obtaining (borrowing) funds from another entity is a financing activity, not an investing activity. Financing activities cover transactions related to our capital structure, such as issuing or repaying debt and equity, while investing activities focus on the acquisition and disposal of long-term assets and investments, including loans made to others that generate interest income.

Because investing activities typically include things like purchasing or selling property, plant, and equipment (PPE), purchasing or selling investments, or making loans to borrowers (which create notes receivable), the act of obtaining a loan is not an investing activity; it represents financing activity and affects the financing section of the cash flow statement.

Note on missing options: The prompt shows an empty list for answer options, which means we don’t have the other choices to evaluate here. In a complete item, you would compare each alternative against the definitions above: if an option involves buying/selling investments or long-term assets, it would be investing; if it involves borrowing or repaying debt, it would be financing; if it involves operating the core business activities, it would be operating.

In summary, the reasoning supports that the action of obtaining a loan from another entity falls under financing activities, not investing activities, making it the correct choice for NOT being an investing activity. If other options were present, we would assess each in light of the same categories to determine which one is not investing.

2025 T1 DP DPBS1140 BMGT1340 Financial Management

Which of the following is NOT classified as an investing activity?

View Explanation

Log in for full answers

Similar Questions

When preparing the statement of cash flows using the indirect method (U.S. GAAP), the current portion of long-term debt would appear

Which of the following statements is false?

Why is the operating activities section of the statement of cash flows often believed to be the most important part of the statement?

On the statement of cash flows (indirect method), the loss on the sale of an office building by Apple Inc. can be found in the

Which of the following is not disclosed in a statement of cash flows using the direct method?

In a statement of cash flows, interest paid to creditors is classified as a cash flow from:

More Practical Tools for Students Powered by AI Study Helper

Homework AI Solver

Stylized AI Paper Writer

Plagiarism Checker Assistant

Citation AI Academic Writing Tool

In-Class Translation Assistant

AI Note Generator

AI Quiz Answers

Past Exam Questions from University Test Bank

Smart Practice Assistant

Adaptive Practice

Making Your Study Simpler