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A company acquired a building, paying a portion of the purchase price in cash and issuing a mortgage note payable to the seller for the balance. In a statement of cash flows, what amount is included in investing activities for the above transaction

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Answer:

The cash payment is included in investing activity.

Explanation:

Items included in investing activity refers to assets that are used by the company, such as land, equipments and building.

A mortgage note payable is an example of a financing activity. Here the company has secured financing for it's acquisition by way of mortgage.

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