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Basic Question 0 of 26
Which of the following statement(s) is (are) true?
II. Cash payments to purchase inventory are classified as investing activities.
III. Regardless of whether the direct or indirect method is used, the statement of cash flows will report the same dollar amount of net cash flow from operating activities.
I. Payments of dividends are classified as financing activities (under GAAP).
II. Cash payments to purchase inventory are classified as investing activities.
III. Regardless of whether the direct or indirect method is used, the statement of cash flows will report the same dollar amount of net cash flow from operating activities.
User Contributed Comments 2
| User | Comment |
|---|---|
| danlan | II is operating because it's for inventory; cash payments for long term asset are investing activities. |
| sarath | Inventory is typically a short term asset , so operating cash flow...under the investing activities we consider the long term assets.. |
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Learning Outcome Statements
describe the measurement of inventory at the lower of cost and net realisable value and its implications for financial statements and ratios
CFA® 2025 Level I Curriculum, Volume 2, Module 6.