Question

Selected information from Green Co.'s accounting records and financial statements is as follows: Gain on sale of land $ 12,000 Proceeds from sales to customers 21,800 Purchase of Black, Inc. bonds (face amount $205,000) 367,000 Amortization of bond discount 4,800 Cash dividends declared 98,000 Cash dividends paid 72,000 Proceeds from sales of Green Co. common stock 157,000 What are the net cash flows from financing activities that will be reported in the statement of cash flows? (Enter net cash outflows with a minus sign.)

Answer 1

Answer:

cash generate from financing activities     85,000

Explanation:

financing activities:

sale of common stock 157, 000

cash dividends paid     (72,000)

cash generate from financing activities     85,000

On the cash flow statement we will focus on trasnaction that involve cash.

The financing activities will only consider the finance of the business. This is the dividends and common stock.

The amortization on bonds don't involve cash, so are ignored.

The purchase of bonds are investing activities, the business is not financing.