The correct answer is D. In all the above cases.
A transaction results in the flow of funds when there is a change in the financial position of an entity. This can happen when a non-current asset is purchased out of a current asset, when debentures are redeemed on cash, or when preference share capital is issued.
When a non-current asset is purchased out of a current asset, the entity will have to use cash to pay for the asset. This will result in a decrease in the entity’s cash balance and an increase in the entity’s non-current asset balance.
When debentures are redeemed on cash, the entity will have to use cash to pay off the debentures. This will result in a decrease in the entity’s cash balance and a decrease in the entity’s long-term debt balance.
When preference share capital is issued, the entity will receive cash from the investors. This will result in an increase in the entity’s cash balance and an increase in the entity’s equity balance.
In all of these cases, there is a change in the financial position of the entity, which means that there is a flow of funds.