Match List – I with List – II. LIST - I LIST - II A. Purchase of mach…

The correct answer is Option (1) → A-III, B-IV, C-I, D-II

(A) Purchase of machinery — this matches (III) Investing Activities. Machinery is a fixed asset; cash paid to acquire it is an investing outflow.

(B) Dividend paid on preference shares — this matches (IV) Financing Activities. Dividends paid on equity and preference capital are financing outflows.

(C) Cash Purchase — this matches (I) Operating Activities. Cash paid to suppliers for goods is an operating outflow.

(D) Cash paid to Bank — this matches (II) Cash and Cash equivalents. Depositing cash in the bank only moves money between cash in hand and bank balance, both of which are cash; there is no cash flow.