Question

Of which are these are operating, investing, financing, and non-cash activities? Purchase of furniture for cash, deprecation expense, new long-term loan for operations, proceeds from sale of land, change in accounts payable, gain on sale of building, issuance of long-term notes payable, and conversion of bonds payable to common stock.

Answer 1

Purchase of furniture for cash - It is an investing activity since it involves acquisition of an asset

deprecation expense - It is an operating activity. It is added to the net income while calculating cash flows from operating activities   

new long-term loan for operations - It is a financing activity since it provides finance to the business.

proceeds from sale of land - It is an investing activity since it involves disposal of an asset.

change in accounts payable - It is an operating activity since accounts payable originate from day to day transactions of the business.

gain on sale of building - It is subtracted from net income while calculating cash flows from operating activities.

issuance of long-term notes payable -   It is a financing activity since it provides finance to the business.

conversion of bonds payable to common stock - It is non cash activity since it merely involves conversion of one source of finance into another. There is no cash inflow or cash outflow in this.