Redemption of


Baird Corp. had the following activity in its most recent year of operations:

1- Redemption of bonds
2- Signing of a finance lease agreement for equipment
3- Payment of a monthly finance lease obligation
4- Purchase of a treasury bill as a cash equivalent
5- Payment on an operating lease agreement
6- Unrealized holding loss on investment accounted at fair value with gains and losses in net income
7- Impairment loss on goodwill
8- Unrealized gain accrued on FV-NI equity security investments
9- Redemption of preferred shares classified as debt
10- Payment of principal on an operating line of credit
11- Payment of interest income on an operating line of credit
12- Receipt of interest income on a note receivable
13- Receipt of dividends on an investment in common shares
14- Purchase of an investment in retractable preferred shares (that will mature within 90 days of purchase date)

Assume that Baird Corp. follows IFRS, and that the company has adopted the policy of classifying dividends received as operating activities, dividends paid as operating activities, interest received as investing activities, and interest paid as a financing activity on the cash flow statement. Using the indirect method, classify the items above as one of the following:

a- An operating activity, added to net income;
b- An operating activity, deducted from net income
c- An investing activity,
d- A financing activity
e- A significant non-cash investing or financing activity; or
f- None of these options.

 

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Accounting Basics: Redemption of
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