Question

a. Net income was $35,000.b.Issued common stock for $64,000 cash.c.Paid cash dividend of $14,600.d.Paid $50,000 cash to settle a note payable at its $50,000 maturity value.e.Paid $12,000 cash to acquire its treasury stock.f.Purchased equipment for $39,000 cash.Use the above information to determine this company’s cash flows from financing activities.

Answer 1

Answer:

Cash flows from financing activities was  -$12,600

Explanation:

Cash flows from financing activities = Received cash from issuing common stock - Paid cash dividend - Paid cash to settle a note payable - Paid cash to acquire its treasury stock

The company issued common stock for $64,000 cash, paid cash dividend of $14,600, $50,000 cash to settle a note payable, $12,000 cash to acquire its treasury stock.

Cash flows from financing activities = $64,000 - $14,600 - $50,000 - $12,000 = -$12,600