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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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