Question : Where will you show purchase of intangible assets in a Cash Flow Statement?
Option 1: Shown as outflow under 'Cash flows from investing activities'.
Option 2: Shown as outflow under 'Cash flows from operating activities'.
Option 3: Shown as inflow under 'Cash flows from investing activities'.
Option 4: None of the above
Correct Answer: Shown as outflow under 'Cash flows from investing activities'.
Solution : Answer = Shown as outflow under 'Cash flows from investing activities'.
The purchase of intangible assets would be shown as an outflow under "Cash flows from investing activities" in the Cash Flow Statement because it represents an investment in assets that are not physical in nature and are expected to generate future economic benefits.
Hence, the correct option is 1.
