Which of the following is NOT a transaction category in accounting?

• A. Investing activities
• B. Financing activities
• C. Auditing activities
• D. Operating activities

Answer: (C)

Verified step by step guidance

1. Understand the concept of transaction categories in accounting. These categories are used to classify cash flows and activities within a business. The main categories are Operating, Investing, and Financing activities.
2. Operating activities include transactions related to the core business operations, such as revenue generation and expenses (e.g., sales, salaries, rent).
3. Investing activities involve transactions related to the acquisition or disposal of long-term assets, such as purchasing equipment or selling investments.
4. Financing activities include transactions related to raising capital or repaying obligations, such as issuing shares, borrowing money, or repaying loans.
5. Auditing activities are not a transaction category in accounting. Auditing refers to the process of examining financial records to ensure accuracy and compliance, but it does not classify cash flows or business activities.