During the current year, Maddox Industries sold a delivery truck with a book value of $5,000 for $15,000, declared and paid cash dividends of $8,000 and borrowed $50,000 from First National Bank.Maddox's net cash flows provided by financing activities is

Question

Quizplus · Accepted Answer

The net cash flows provided by financing activities can be calculated by adding up the cash inflows and outflows from financing activities.

Cash inflows from financing activities: 
- Borrowing $50,000 from First National Bank

Cash outflows from financing activities: 
- Declaring and paying cash dividends of $8,000

Net cash flows provided by financing activities = $50,000 - $8,000 = $42,000

Therefore, the correct answer is C.

During the Current Year, Maddox Industries Sold a Delivery Truck