Transaction involving both investing and financing activities in the cash flow statement:

One example of a transaction that involves both investing and financing activities in the cash flow statement is the purchase of a new building using a combination of cash and a bank loan.

Explanation:

When a company purchases a new building, it is considered an investing activity because it involves the acquisition of a long-term asset that will benefit the company over an extended period of time. This transaction is reflected in the cash flow statement under the investing activities section.

On the other hand, if the company does not have enough cash on hand to purchase the building outright, it may obtain a bank loan to finance a portion of the purchase. This loan is considered a financing activity because it involves the borrowing of funds to support the company's operations. This transaction is reflected in the cash flow statement under the financing activities section.

Impact on the cash flow statement:

The cash flow statement is divided into three sections: operating activities, investing activities, and financing activities. The purchase of the building using a combination of cash and a bank loan will impact all three sections of the cash flow statement.

1. Operating activities: The purchase of the building will not directly impact the operating activities section of the cash flow statement. However, it may indirectly impact operating activities in the future by reducing operating expenses related to rent or lease payments.

2. Investing activities: The purchase of the building using cash will result in an outflow of cash from the company. This outflow of cash will be recorded as a negative amount in the investing activities section of the cash flow statement.

3. Financing activities: If the company obtains a bank loan to finance a portion of the building purchase, the loan proceeds will be recorded as an inflow of cash in the financing activities section of the cash flow statement.

Overall, the purchase of a new building using a combination of cash and a bank loan will impact the cash flow statement by affecting the investing activities section with the outflow of cash and the financing activities section with the inflow of cash. The operating activities section may also be indirectly impacted in the future due to reduced operating expenses.

Purchase of fixed asstes against issue of debentures