Question

Operating activities result from the cash effects of:
O producing and delivering goods and services.
O purchasing and disposing of fixed assets used in production of revenue.
O borrowing and repaying loans used in the production of revenue.
O selling stocks and bonds to raise capital for the generation of revenue.

Answer 1

Operating activities result from the cash effects of producing and delivering goods and services. The correct answer would be option A.

The tasks a company performs that are directly relevant to offering its products and/or services to the market are referred to as operating activities. A product or service is manufactured, distributed, marketed and sold. These are the company's primary business activities. The majority of an organization's cash flow often comes from its operating operations, which also heavily influences its profitability. Cash receipts from sold goods, employee paychecks, tax payments, and payments to suppliers are a few typical operating activities. The income statement and cash flow statement, in particular, can be found on a company's financial statements. Operating activities are different from investing and finance activities, which are corporate tasks unrelated to the delivery of goods and services.

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