Use the "QUESTION INFORMATION" below to answer the next $2$ questions $[$Questions $14-15].$ Blank amortization tables and present value tables are available in your scratch paper packet.

QUESTION INFORMATION: On January $1,2023,$ Wolfpack Company paid $$42,027$ to invest in $4-$year bonds. Wolfpack accounts for these bonds as a held$-$to$-$maturity $($HTM$)$ investment. The face value of the bonds was $$37,900.$ Wolfpack receives interest annually on December $31$ at a stated rate of $7\%,$ and the market interest rate is $4\%$ for bonds of similar risk and maturity. The fair value of the bonds at December $31,2023$ was $$36,928.$

QUESTION TO ANSWER: Which of the following options accurately describes the classification of Wolfpack's $2023$ cash inflows and outflows related to its HTM bond investment?

Correct Answer

Purchase is an investing outflow ; Cash received from interest is an operating inflow

Purchase is an operating outflow ; Cash received from interest is a financing inflow

Purchase is an investing outflow ; Cash received from interest is a financing inflow