The correct answer is B. decreased cash.
A statement of cash flows is a financial statement that reports a company’s cash receipts and cash payments during a specific period of time. It is divided into three sections: operating activities, investing activities, and financing activities.
Investing activities are those that involve the acquisition and disposal of long-term assets, such as property, plant, and equipment. When a company invests in short-term financial investments or fixed assets, it is using cash. This results in a decrease in cash on the statement of cash flows.
The other options are incorrect. Option A is incorrect because investing activities result in a decrease in cash, not an increase. Option C is incorrect because investing activities do not affect liabilities. Option D is incorrect because investing activities do not affect equity.