Home › ACCA › Financial Accounting › Statement of Cash Flows › Financing activities show: cash from issuing com…
Financing activities show: cash from issuing common stock $20,000; cash to redeem bonds $50,000; cash dividends paid $6,000. What is net cash flow from financing activities?
A($24,000)
B$36,000
C($36,000)
D($76,000)
Answer & Solution
Correct answer: C. ($36,000)
1. Inflow: issuing stock +$20,000.
2. Outflows: redeem bonds −$50,000; dividends −$6,000 = −$56,000.
3. Net = $20,000 − $56,000 = ($36,000), a net outflow shown in parentheses.
4. Trap: ($24,000) omits the dividends payment.
_Source: Jonick, Principles of Financial Accounting (CC BY-SA 4.0), §7.2.3 "Financing Activities Section", p.277_
Related questions
Both the direct and indirect methods are used to prepare which part of the statement of caWages expense was $20,000. Beginning wages payable was $17,000 and ending was $14,000. UndInventory purchases for the year were $126,000. Beginning accounts payable was $22,000 andBeginning inventory was $80,000, ending inventory $112,000, and cost of merchandise sold $Sales were $174,000. Beginning accounts receivable was $58,000 and ending was $34,000. UndNet cash from operating activities is $46,000, from investing $28,000, and from financing A firm reports investing inflows of $99,000 (land) and $90,000 (investments) and an outfloCash dividends payable began the year at $8,000, dividends of $3,000 were declared, and th