Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Cash Flow Statement

Question:
An increase in Bank overdraft of ₹50,000 will be shown as:
Options:
Inflow of finance activities
Outflow of finance activities
Inflow of investing activities
Added as increase in current liabilities in operating activities
Correct Answer:
Inflow of finance activities
Explanation:
A bank overdraft is a financing activity in the cash flow statement. An increase in this will make inflow of cash to the company. Thus it is an inflow of financing activity.