Question:
Which of the following transactions will result in cash flows from operating activities?
Which of the following transactions will result in cash flows from operating activities?
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Always classify cash flows based on their relation to operating, investing, or financing activities as per accounting standards.
Updated On: Jan 18, 2025
- Cash receipts from sale of investments ₹ 60,000
- Cash receipts from sale of goods ₹ 94,000
- Dividend received ₹ 31,000
- Payment of cash for purchase of fixed assets ₹ 3,00,000
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The Correct Option is B
Solution and Explanation
- Operating activities involve cash flows related to the principal revenue-generating activities of a company.
- Sale of goods is an operating activity as it is part of the company’s core operations.
- Sale of investments and dividend receipts are classified under investing activities, and payment for fixed assets is also an investing activity.
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