Avatar Company uses the indirect method to prepare its statement of cash flows. Refer to the following portion of the comparative balance sheet: Note:1)There was no retirement of stock during the year. "2)There were no sales of treasury stock during the year.
Which of the following statements would be true?"
A)There was zero net cash flow from transactions involving Common Stock.
B)There was a negative cash flow of $4,000 from the issuance of Common Stock.
C)There was a positive cash flow of $4,000 from the issuance of Common Stock.
D)There was positive cash flow of $16,000 from issuance of Common Stock.

Question

Avatar Company uses the indirect method to prepare its statement of cash flows. Refer to the following portion of the comparative balance sheet:  Note:1)There was no retirement of stock during the year. "2)There were no sales of treasury stock during the year.
Which of the following statements would be true?"
A)There was zero net cash flow from transactions involving Common Stock. 
B)There was a negative cash flow of $4,000 from the issuance of Common Stock. 
C)There was a positive cash flow of $4,000 from the issuance of Common Stock. 
D)There was positive cash flow of $16,000 from issuance of Common Stock.

Quizplus · Accepted Answer

The Answer of Avatar Company uses the indirect method to prepare its statement of cash flows. Refer to the following portion of the comparative balance sheet:  Note:1)There was no retirement of stock during the year. "2)There were no sales of treasury stock during the year.
Which of the following statements would be true?"
A)There was zero net cash flow from transactions involving Common Stock. 
B)There was a negative cash flow of $4,000 from the issuance of Common Stock. 
C)There was a positive cash flow of $4,000 from the issuance of Common Stock. 
D)There was positive cash flow of $16,000 from issuance of Common Stock.

Avatar Company Uses the Indirect Method to Prepare Its Statement