Question

For the following transaction, determine whether cash flows from operating activities will increase, decrease, or remain the same:
(d) Borrowed money from the bank. The term of the note is 90 days.

Answer 1

Borrowed money from the bank. The term of the note is 90 days. In this case, the cash flows from operating activities will remain the same.

The cash flows from operating activities will remain the same money borrowed will result in cash inflow. But, irrespective of the time, the amount of the loan is treated as a part of financing activities in case someone borrowed money from the bank. The term of the note is 90 days.

It's miles the first section depicted on an organization's cash flow statement. Cash drift from operating activities does not consist of lengthy-time period capital expenses or funding sales and price. CFO focuses simplest at the center of commercial enterprise and is also referred to as working cash waft or net coins from running activities.

Operating income excludes interest profits or fees. For instance, a garb saves working activities that might include subsequent: shopping for materials from suppliers and purchasing labor to supply garb.

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