Chow Company earned $3,700 of cash revenue, paid $2,100 for cash expenses, and paid a $750 cash dividend to its stockholders. Which of the following statements is true?

Question

Quizplus · Accepted Answer

To calculate the net cash inflow from operating activities, we subtract cash expenses from cash revenue: $3,700 - $2,100 = $1,600. The cash dividend paid to stockholders is a financing activity and not included in the operating activities. There is no information given about investing activities, so we cannot determine the net cash outflow for that category.

Chow Company Earned $3,700 of Cash Revenue, Paid $2,100 for Cash