Kaze Corporation's cash and cash equivalents consist of cash and marketable securities. Last year the company's cash account increased by $25,000 and its marketable securities account decreased by $15,000. Cash provided by operating activities was $38,000. Net cash provided by investing activities was $9,000. Based on this information, the net cash flow from financing activities on the statement of cash flows was:

Question

Quizplus · Accepted Answer

To find the net cash flow from financing activities, we need to use the formula: Net cash flow from financing activities = Change in cash + Change in marketable securities - Net cash provided by operating activities - Net cash provided by investing activities. 
Using the information given, we have: 
Change in cash = $25,000 (increase) 
Change in marketable securities = -$15,000 (decrease) 
Net cash provided by operating activities = $38,000 
Net cash provided by investing activities = $9,000 
Plugging these numbers into the formula, we get: 
Net cash flow from financing activities = $25,000 - $15,000 - $38,000 - $9,000 = -$37,000 
This means that there was a net $37,000 decrease in cash flow from financing activities. Therefore, the answer is A.

Kaze Corporation's Cash and Cash Equivalents Consist of Cash and Marketable