Question

A local nongovernmental NFP organization held a fund-raising campaign for its new building. On the statement of cash flows, where would the NFP report the contributions received for the new building?

A) Financing activity.
B) Investing activity.
C) Operating activity.
D) Contributions are not shown on the statement of cash flows.

Answer 1

Contributions received for the new building by the nongovernmental NFP organization would be reported under the financing activity section on the statement of cash flows.

Step-by-step explanation:

On the statement of cash flows, the contributions received for the new building by the nongovernmental NFP organization would be reported under the financing activity section. This is because fund-raising campaigns typically involve obtaining funds from donors, which is considered a financing activity. Contributions received for the new building would be classified as cash inflows from financing activities.