Cash advances and loans made by financial enterprises are usually classified as ___________ activity in a Cash Flow Statement.
- AFinancing Activity
- BOperating Activity
- CInvesting Activity
- DPromotional Activity
Solution & Step-by-step Explanation
For a financial enterprise/company (like a bank or lending firm), lending money, issuing loans, and dealing with advances form part of their primary revenue-producing behavior. Thus, as per AS 3, these flows fall under Operating Activities.