In a statement of cash flows, the payment of a cash dividend on common stock outstanding should be classified as cash outflows for
A) operating activities.
B) investing activities.
C) credit activities.
D) financing activities.

Question

Quizplus · Accepted Answer

The payment of a cash dividend on common stock is classified as a financing activity because it relates to the financing of the enterprise through dividends to shareholders, which is a way of returning investment to them.

In a Statement of Cash Flows, the Payment of a Cash