CUET Preparation Today
| How will you deal with an increase in the balance of "Securities Premium Reserve" while preparing a cash flow statement? |
Cash Flow from Investing Activities Cash Flow from Financing Activities Cash Flow from Operating Activities No cash flow |
| Cash Flow from Financing Activities |
| Financing activities relate to long-term funds or capital of an enterprise, e.g., cash proceeds from issue of equity shares, debentures, raising long-term bank loans, repayment of bank loan, etc. As per AS-3, financing activities are activities that result in changes in the size and composition of the owners’ capital (including preference share capital in case of a company) and borrowings of the enterprise. Premium is related to issue of shares and it will fall under financing activity. |
