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    Question

    Which of the following best represents a cash-flow from

    financing activities?
    A Cash paid to suppliers for inventory Correct Answer Incorrect Answer
    B Proceeds from sale of fixed assets Correct Answer Incorrect Answer
    C Proceeds from issue of long-term debt Correct Answer Incorrect Answer
    D Interest received on investments Correct Answer Incorrect Answer

    Solution

    Financing activities are transactions that change the size and composition of the owner's capital and borrowings of the entity. Proceeds from issuing long-term debt are a cash inflow from financing activities.

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