Question

Sale of marketable securities will be shown under:

• A. Operating activities
• B. Financing activities
• C. Investing activities
• D. Cash & cash equivalent

Hint:

Always classify “sale/purchase of investments” under investing activities in cash flow statements.

Answer 1

The Correct Option is C

Step 1: Recall Cash Flow classification.
- Operating activities: related to day-to-day business operations.
- Financing activities: related to raising funds (equity, debentures, loans).
- Investing activities: related to purchase or sale of fixed assets and investments.
Step 2: Identify the activity.
Sale of marketable securities represents disposal of an investment. Hence, it is an “investing activity”.
Step 3: Conclude.
Thus, the sale of marketable securities is shown under Investing Activities.
Final Answer: \[ \boxed{\text{Investing activities}} \]