'Purchase of machinery for cash' is which type of activity in the cash flow statement?
Options:
Operating activity
Investing activity
Financing activity
None of these
Correct Answer:
Investing activity
Explanation:
Cash Outflows from investing activities Cash payments to acquire fixed assets including intangibles and capitalised research and development. Cash payments to acquire shares, warrants or debt instruments of other enterprises other than the instruments those held for trading purposes. Cash advances and loans made to third party (other than advances and loans made by a financial enterprise wherein it is operating activities).