Which of the following activities would not be considered an investing activity?

Among the options provided, a) issuance of common stock would not be considered an investing activity. Investing activities typically involve transactions related to the purchase and sale of long-term assets and investments. Let’s break down the options:

  • a) Issuance of common stock: This activity relates to financing rather than investing. It’s about raising capital for the company by selling shares to investors.
  • b) Purchase of used equipment: This is an investing activity as it involves acquiring a long-term asset that will contribute to the company’s operations.
  • c) Sale of land: Selling land is also an investing activity since it involves the disposal of a long-term asset.
  • d) Sale of a long-term investment: This is considered an investing activity as it pertains to the gain or loss from investments made with the intent of holding them for a long period.

In summary, the issuance of common stock is associated with financing activities necessary for raising funds, and is not classified as an investing activity.

More Related Questions