Question

Which of the following items is reported on the statement of cash flows under financing activities?a. Declaration of a cash dividend. b. Payment of a cash dividend. c. Declaration of a stock dividend. d. Payment of a stock dividend. e. Stock split.

Answer 1

Answer:

B. Payment of cash dividend

Explanation:

Payment of stock dividend, declaration of cash dividend or stock split does not involve outflow of cash. Hence, they do not form part of cash flow statement.

A stock dividend is a dividend payment made in the form of additional shares rather than a cash payout.