CFA Practice Question

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CFA Practice Question

Which one of the following would be classified as an investing activity?

A. Retirement of bonds payable
B. Selling equity investments
C. Issuing common stock
D. Purchase of inventory
Correct Answer: B

Both sales and purchases of equity investments are considered investing activities.

User Contributed Comments 12

User Comment
danlan Sales and purchase of securities are investing, issuing securities are financing
teddajr Sell/Purchase - Inveting, Issue - Financing.
mirfanrana sales and purchase of securities are investing,issuing securities are financing
MattyBo Purchase/sale of inventory is Operating
magicchip This question is not bad at all.
nayagan What is retirement of bonds payable? Operating?
udhay Retirement of bond payable is CFF
johntan1979 CFF
Shaan23 From last question that means.

Selling Bonds is CFF
Selling Equity is CFI
leon121 How about treasury stock purchases? isn't that CFI?
Inaganti6 I think CFF is only for changes in capital structure - paying/borrowing debt or adding equity
Inaganti6 Selling equity ? let's be technically correct...

I think selling equity INVESTMENTS is CFI
and selling equity (as in issuing new shares) is CFF

should've read the question twice it said selling equity INVESTMENTS as in shares in other companies
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