The records of Aaron Paint Co. showed the issuance of a long-term note in the amount of $15,900; issuance of Common Stock in the amount of $50,900; and payment of dividends in the amount of $21,100. The amount of Net Cash Flow from Financing Activities using the indirect method is:
A) $87,900.
B) $45,700.
C) $13,900.
D) $56,100.

Question

Quizplus · Accepted Answer

Net Cash Flow from Financing Activities is calculated by adding the cash flows from financing activities. Here, issuance of a long-term note ($15,900) and issuance of Common Stock ($50,900) are inflows, while payment of dividends ($21,100) is an outflow. Thus, the net cash flow is $15,900 + $50,900 - $21,100 = $45,700.

The Records of Aaron Paint Co