Question

Pick the odd one out while Calculating Cash Flow from Financing Activities :

• A. Issue of Shares
• B. Repayment of Bank Loan
• C. Redemption of Debentures
• D. Rent received

Hint:

Always recall the core definition of the 3 cash flows, i.e. Investing, Financing and Operating.

Answer 1

The Correct Option is D

Understanding Cash Flow Activities:
Cash Flow Statements categorise cash flows into operating, investing, and financing activities. Financing activities relate to how a company raises capital and repays it.
Explanation:

Issue of Shares: Involves raising capital from shareholders.

Repayment of Bank Loan: Reduces the company's debt.

Redemption of Debentures: Similar to repaying a loan, it reduces long-term debt.
Therefore Rent received is classified as Cash flow from operating activities. The key to finding the odd one out here is finding the option that does not involve loan.