Asked by: Marisca Spellmanbusiness and finance debt factoring and invoice discounting
Is equipment an investment or operating?
Thereof, is accounts receivable operating investing or financing?
A decrease in the Accounts Receivable will appear as an increase in cash from operating activities. Changes in current assets (other than Cash) and changes in current liabilities are shown in the operating activities section of the statement of cash flows. Financing. Accounts Receivable is a current asset.
Subsequently, question is, what is the difference between operating investing and financing activities?
Operating activities include cash activities related to net income. Investing activities include cash activities related to noncurrent assets. Financing activities include cash activities related to noncurrent liabilities and owners' equity.
Operating activities involve transactions that create revenues and expenses and thus are used to determine net income (loss). In other words, operating activities are principal revenue producing activities. Interest income (i.e., return on loans) Dividends income (i.e., return on equity securities)