Answered: Which of the following is an example of…

Which of the following is an example of a financing activity in a statement of cash flows? a) Purchasing inventoryb) Paying dividendsc) Selling equipmentd) Paying employee wages

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter8: Current And Contingent Liabilities

Section: Chapter Questions

Problem 17MCQ

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Question

Which of the following is an example of a financing activity in a statement of cash flows?

a) Purchasing inventory
b) Paying dividends
c) Selling equipment
d) Paying employee wages

Definition Definition Net amount of cash that an entity receives and expends over the course of a given period. For a business to continue operating, positive cash flows are required, and they are also necessary to produce value for investors. Investors in particular prefer to see growing cash flows even after capital expenditures have been paid for (which is known as free cash flow).

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