Question : Which of the following is not an example of operating activities for a Non-finance company?
Option 1: Cash payment for purchase of goods and/or availing services;
Option 2: Cash payment to Trade Payables (i.e., Creditors and Bills Payable);
Option 3: Cash payment of wages, salaries and other payments to employees;
Option 4: Dividend received on securities;
Correct Answer: Dividend received on securities;
Solution : Answer = Dividend received on securities;
Dividends received on securities are
not
an example of operating activities in the case of a
Non-finance company
. Operating activities typically involve transactions related to core business operations, such as sales, purchases, and payments to suppliers and employees, whereas dividends received are related to investment activities. In the case of a
finance company
, dividends received on securities are an example of operating activities.
Hence, the correct option is 4.
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