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    Question

    GB Ltd is preparing its Cash Flow Statement. Which of

    the following will be recorded under the investing activity?
    A Paying rent Correct Answer Incorrect Answer
    B Selling an old machine Correct Answer Incorrect Answer
    C Paying interest on a loan Correct Answer Incorrect Answer
    D Issuing shares Correct Answer Incorrect Answer
    E Paying salaries Correct Answer Incorrect Answer

    Solution

    Investing activities involve acquisition or disposal of long-term assets. Sale of a machine will be recorded under investing activities, reflecting the cash inflow from investment done for business operations.

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