When a transfer is made between cash and cash equivalents with no gain or loss, how is the transaction treated in the statement

Question

3 years ago

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When a transfer is made between cash and cash equivalents with no gain or loss, how is the transaction treated in the statement

of cash flows? Multiple Choice It is not reported. It is included as an investing activity. It is included as a noncash financing activity.

Business

2 answers:

WITCHER [35] · Answer 1 · 2022-04-20T23:48:26+03:00

Answer:

It is not reported

Explanation:

when there is a transfer of cash or its equivalent and there is no gain or loss, there is a break even. it can't be said that there has been a transaction between both parties hence such exchange is not reported in the statement of cash flows

A non cash financing activity is a financial activity that doesn't have a direct effect on cash flows, it is usually a long term kind of investments and they are always recorded at the bottom of the statement of cash flows of a company such long term investments include : assets , liabilities and equities.

statuscvo [17] · Answer 2 · 2022-04-20T22:45:26+03:00

Answer: The correct answer is "It is not reported.".

Explanation: When a transfer is made between cash and cash equivalents with no gain or loss, the transaction is not reported in the statement of cash flows because it does not represent a true change in cash flow since it does not produce profits or losses.