Company A has an inflow and an outflow of cash related to property, plant and eq

Question

Company A has an inflow and an outflow of cash related to property, plant and equipment. Which of the following is correct?

a. The two cash effects can be netted and presented as one item in the investing activities section.

b. The two cash effects can be netted and presented as one item in the financing activities section.

c. The cash inflow and cash outflow should be reported separately in the investing activities section.

d. The cash inflow and cash outflow should be reported separately in the financing activities section.

e. None of these answers are correct.

Explanation / Answer

c. The cash inflow and cash outflow should be reported separately in the investing activities section.

property, plant and equipment is an which is an essential for the company in order to produce, so, there is an investment in it, so, it comes under investing activity.

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