Question

Which of these would be reported as cash flows from investing activities?

-Cash paid to build a new corporate headquarters
-Cash received from owners in exchange for stock
-Cash paid to buy equipment
-Cash paid for advertising
-Cash paid for rent
-Cash paid for employee wages

Answer 1

Cash paid to build a new corporate headquarters and cash paid to buy equipment are reported as cash flows from investing activities, related to long-term assets.

Step-by-step explanation:

Of the options provided, cash paid to build a new corporate headquarters and cash paid to buy equipment would be reported as cash flows from investing activities on a company's statement of cash flows. These types of transactions are related to acquiring or selling long-term assets, such as property, plant, and equipment, which can generate revenue over a long period of time. Investing activities do not include operational expenses like advertising, rent, or wages, nor do they include financing activities such as receiving cash from owners in exchange for stock.