Final answer:
Issuing stock to acquire land is a non-cash transaction that does not directly impact the cash balances on the statement of cash flows. It must be disclosed in a separate section or in the notes to the financial statements.
Step-by-step explanation:
When a company issues stock to acquire land, it involves a non-cash transaction that must be disclosed in the statement of cash flows under the investing and financing activities. Instead of a cash outflow to purchase the land, the company is exchanging its own equity in the form of shares. This increases the shareholders' equity and decreases the assets by the value of the land at the time of the transaction if it's listed on the balance sheet. However, since no cash is exchanged in this transaction, it does not directly affect the cash balances reported in the operating, investing, or financing sections of the statement of cash flows. Instead, this non-cash transaction would be reported either in a separate schedule at the bottom of the statement of cash flows or in the notes to the financial statements.