The statement, transactions that don’t increase or decrease cash, but that result in significant investing and financing activities, are reported either directly after the cash flow statement or in a separate note to the financial statements as noncash activities is True .
Agreements formed by a business with its owners and lenders to obtain or recover resources are referred to as financing operations. In other words, financial activities provide the business with funding, enable debt repayment, and profit for the owners. Financing activities include giving and receiving equity.
The financing activity in the cash flow statement focuses on how a firm raises capital and distributes it to investors via capital markets. These acts include, among others, paying cash dividends, increasing or decreasing indebtedness, issuing and reselling additional stock.
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