Question

In which category ‘Rent received’ will be classified while preparing the cash flow statement in case of (i) Real estate agent and (ii) Non-real estate agent.

Answer 1

Rent received will be classified as follows in the cash flow statement:

1. Real Estate Agent: Rent received is part of the core business, so it will be classified as cash flow from operating activities.
2. Non-Real Estate Agent: Rent received is not related to the main operations, so it will be classified as cash flow from investing activities.