What activities are considered to be operating activities in business?

Study for the WGU ACCT5000 C213 Accounting Exam. Study with flashcards and multiple choice questions, each question has hints and explanations. Get ready for your exam!

Operating activities refer to the core functions of a business that are essential for its daily operations and overall mission. This includes activities that generate the majority of a company's revenue and cover its ongoing expenses.

The choice that emphasizes the day-to-day operations of a business is correct, as it encompasses activities like purchasing inventory, selling products or services, paying suppliers, and covering operating expenses such as salaries and rent. These activities are vital for maintaining the business's operational efficiency and profitability.

In contrast, buying and selling long-term assets relates to investing activities, as it involves capital expenditures and asset management rather than direct operations. Borrowing from creditors refers to financing activities, which deal primarily with how a business obtains and manages its capital. Investing in market securities translates to investing activities as well, focusing on the acquisition and management of financial instruments rather than the operational side of the business.

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy