Company X’s had cash flows for the year as follows ($ in millions):CASH RECEIVED FROM: Customers$1,800Interest on investments200Sale of land100Sale of common stock600Issuance of debt securities2,000CASH PAID FOR: Interest on debt$300Income tax80Debt principal reduction1,500Purchase of equipment4,000Purchase of inventory1,000Dividends on common stock200Operating expenses500Using the direct method, Company X's would report net cash inflows (outflows) from operating activities in the amount of:($80)$120$200$420

Cash flow from operating activities consists of cash inflows and cash outflows from day to day…

Answered: Company X’s had cash flows for the year…

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter6: Cash And Internal Control

Section: Chapter Questions

Problem 6.2E

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Company X’s had cash flows for the year as follows ($ in millions):

CASH RECEIVED FROM:
Customers	$1,800
Interest on investments	200
Sale of land	100
Sale of common stock	600
Issuance of debt securities	2,000
CASH PAID FOR:
Interest on debt	$300
Income tax	80
Debt principal reduction	1,500
Purchase of equipment	4,000
Purchase of inventory	1,000
Dividends on common stock	200
Operating expenses	500

Using the direct method, Company X's would report net cash inflows (outflows) from operating activities in the amount of:

($80)
$120
$200
$420

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