The first month of operation showed the net cash from operating activities to be $3,760, the net cash from investing activities to be ($5,415), and the ending cash balance to be $3,425. The net cash from financing activities must be:
A) $1,770.
B) $5,080.
C) $5,750.
D) $12,600.

Question

Quizplus · Accepted Answer

To find the net cash from financing activities, we can use the formula:

Net Cash from Financing Activities = Ending Cash Balance - Net Cash from Operating Activities – Net Cash from Investing Activities

Plugging in the given values, we get:

Net Cash from Financing Activities = $3,425 - $3,760 – (-$5,415)
Net Cash from Financing Activities = $3,425 - $3,760 + $5,415
Net Cash from Financing Activities = $1,655 + $5,415
Net Cash from Financing Activities = $7,070

Therefore, the net cash from financing activities is $5,080 (Option B).

The First Month of Operation Showed the Net Cash from Operating