Team Shirts,Inc.purchased $10,000 worth of treasury stock,paid $5,000 of its accounts payable,and paid $500 in dividends.The amount of net cash from (or used)for FINANCING activities is ________.
A)$(10,500)
B)$(13,500)
C)$10,500
D)$13,500

Question

Quizplus · Accepted Answer

The purchase of treasury stock is a financing activity that results in a decrease in cash, so that's -$10,000. Paying accounts payable is an operating activity and has no effect on the statement of cash flows. Paying dividends is also a financing activity that results in a decrease in cash, so that's -$500. Therefore, the net cash from financing activities is -$10,500.