Chow Company earned $3,300 of cash revenue, paid $1,900 for cash expenses, and paid a $650 cash dividend to its owners. Which of the following statements is true?
A)The net cash inflow from operating activities was $1,400.
B)The net cash outflow for investing activities was $650.
C)The net cash inflow from operating activities was $750.
D)The net cash outflow for investing activities was $1,400.

Question

Quizplus · Accepted Answer

Net cash inflow from operating activities can be calculated as Cash Revenues – Cash Expenses = $3,300 - $1,900 = $1,400. The dividend paid to owners is not considered an operating expense, but rather a financing activity. Therefore, option A is correct. Option B is incorrect because there is no information given about investing activities. Option C and D are incorrect because they do not reflect the correct calculation of net cash inflow from operating activities.

Chow Company Earned $3,300 of Cash Revenue, Paid $1,900 for Cash