Question
Purchase of fixed assets will result in cash
Purchase of fixed assets will result in cash
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Solution
The correct option is B outflow
An increase in capital expenditures means the company is investing in future operations; however, it also points to a reduction in cash flow. Examples of negative cash flow from investing activities include the purchase of fixed assets, the purchase of investment instruments (e.g., stocks), and lending money.
An increase in capital expenditures means the company is investing in future operations; however, it also points to a reduction in cash flow. Examples of negative cash flow from investing activities include the purchase of fixed assets, the purchase of investment instruments (e.g., stocks), and lending money.
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