Final answer:
Proceeds from the sale of property, plant, and equipment are reported under Investing activities in the Statement of Cash Flows. This section reflects transactions involving the purchase or sale of long-term assets. The correct choice for this question is B. Investing activities.
Step-by-step explanation:
The question pertains to determining under which section of the Statement of Cash Flows (SOCF) the proceeds from selling property, plant, and equipment would be reported. This type of transaction is typically considered under the category of Investing activities. The SOCF is divided into three main sections: operating activities, investing activities, and financing activities. Each category records different types of cash flow related to the company's operations.
Operating activities include transactions related to the core business operations, such as revenue from selling products or services and cash spent on supplies and employee wages. Investing activities relate to transactions involving the purchase or sale of long-term assets or investments, including property, plant, and equipment. Financing activities report transactions that change the equity or borrowings of the business, such as issuing stock or taking out loans.
In the context of the question, when a company sells property, plant, and equipment, it is receiving cash in exchange for the disposal of a long-term asset. This is an inflow of cash and is typically presented in the investing activities section of the SOCF. The income from the sale of these long-term assets is a key indicator of how a company is managing its investment portfolio and capital assets, which is why it is placed in this category. Therefore, the correct option for the inflow/outflow from selling property, plant, and equipment is B. Investing activities. It's also important to mention that non-operating activities are not a part of the SOCF.