Which of the following is correct about the statement of cash flows?
A)A company with a net loss will always have a cash outflow from operating activities.
B)Collecting interest earned from a note receivable creates a cash inflow from investing activities.
C)Paying dividends to investors creates a cash outflow from financing activities.

Question

Quizplus · Accepted Answer

Paying dividends to investors creates a cash outflow from financing activities. Option A is incorrect because a company with a net loss can still have cash inflows from operating activities such as depreciation and amortization. Option B is incorrect because collecting interest earned from a note receivable creates a cash inflow from operating activities.

Which of the Following Is Correct About the Statement of Cash