Question

An example of cash flow from financing activities is:

• A. Sale of goods
• B. Sale of investment
• C. Cash receipt from issue of shares
• D. Interest received

Hint:

Remember: Financing = Capital & Loans; Investing = Assets & Investments; Operating = Day-to-day business.

Answer 1

The Correct Option is C

Step 1: Classification of cash flows.
- Operating activities → Day-to-day activities like sales, purchases, wages.
- Investing activities → Buying/selling fixed assets, investments.
- Financing activities → Transactions relating to capital and borrowings.
Step 2: Check each option.
- (A) Sale of goods → Operating activity.
- (B) Sale of investment → Investing activity.
- (C) Cash receipt from issue of shares → Financing activity (raising capital).
- (D) Interest received → Investing activity.
Step 3: Conclude.
Thus, “Cash receipt from issue of shares” is a cash flow from financing activities.
Final Answer: \[ \boxed{\text{Cash receipt from issue of shares}} \]