Question

which of the following sections of the statement of cash flows include purchases and sales of long - term assets? a. the operating activities section b. the financing activities section c. the investing activities section d. the non - cash investing and financing section

Explanation:

To determine which section of the statement of cash flows includes purchases and sales of long - term assets, we analyze each option:

• Option A: The operating activities section focuses on cash flows from the main revenue - producing activities of a business, like cash received from customers and cash paid to suppliers. It does not deal with long - term assets' purchases and sales.
• Option B: The financing activities section is related to cash flows from activities that affect the capital structure of the company, such as issuing or repurchasing stock, and taking or repaying loans. It is not about long - term assets' transactions.
• Option C: The investing activities section is specifically concerned with cash flows related to the acquisition and disposal of long - term assets (like property, plant, equipment, and long - term investments) and other non - current assets.
• Option D: The non - cash investing and financing section records investing and financing activities that do not involve cash, so it is not related to the cash purchases or sales of long - term assets.

Answer:

C. the investing activities section