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Question : Buyback of own shares is shown as an outflow in Financing Activity as _________.

Option 1: Extraordinary items

Option 2: Cash and cash equivalents

Option 3: Both 1 and 2

Option 4: None of the above


Team Careers360 9th Jan, 2024
Answer (1)
Team Careers360 20th Jan, 2024

Correct Answer: Cash and cash equivalents


Solution : Answer = Cash and cash equivalents

Buyback of own shares is shown as an outflow in financing activities because it involves the use of cash or cash equivalents to repurchase shares from shareholders. This transaction represents a capital restructuring activity and is categorized under financing activities in the cash flow statement, impacting the company's capital structure.
Hence, the correct option is 2.

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