Question

A start-up company often engages in the following activities during its first year of operations. Classify each of the following activities into one of the three major activities of an organization. F. Financing I. Investing O. Operating

1. Providing client services. 2. Obtaining a bank loan. 3. Purchasing machinery. 4. Research for its products. 5. Supervising workers. 6. Shareholders investing money in business. 7. Renting office space. 8. Paying utilities expenses.

Short answer

Operating activities are the revenue-generating activities and all transactions are matched with the correct activity.

Step-by-step solution

Definition of operating activities

The operating activities are defined as the activities which help the business to generate revenues. They are related to the supply of goods or services.

Choosing the relevant activity

Transactions	Activities
1.	Operating Activities
2.	Financing Activities
3.	Investing Activities
4.	Operating Activities
5.	Operating Activities
6.	Financing Activities
7.	Operating Activities
8.	Operating Activities