Kanet Company issued common stock for proceeds of $386,000 during 2017. The company paid dividends of $80,000 and issued a long-term note payable for $95,000 in exchange for equipment during the year. The company also purchased treasury stock that had a cost of $15,000. The financing section of the statement of cash flows will report net cash inflows of
A) $291,000.
B) $481,000.
C) $306,000.
D) $371,000.

Question

Quizplus · Accepted Answer

The net cash inflows from financing activities are calculated as proceeds from issuing common stock ($386,000) minus dividends paid ($80,000) minus the purchase of treasury stock ($15,000), resulting in $291,000. The issuance of a long-term note payable for equipment is a non-cash transaction and does not affect cash flows.

Kanet Company Issued Common Stock for Proceeds of $386,000 During