Question

Cash received through the sale of long-term investments would be reported in the statement of cash flows as a a.Cash inflow in the financing activities section. b.Cash inflow in the investing activities section. c.separate schedule. d.Cash inflow in the operating activities section.

Answer 1

Answer:

b.Cash inflow in the investing activities section.

Explanation:

The cash flow statement shows the cash used or provided by the various activities of an entity during a given period. These activities are categorized into operating, investing and financing activities.

Non current asset sale and purchases are accounted for in the investing section of the cash flow statement as an inflow and an outflow of cash respectively.

Hence, Cash received through the sale of long-term investments would be reported as Cash inflow in the investing activities section.