The amount of financing cash flows the company
During the year, a company issues common stock for $54,000 and repays previously borrowed amounts of $82,000. In addition, the company pays dividends of $5,900 to stockholders. Determine the amount of financing cash flows the company will report in the current year.
Determine the amount of financing cash flows the company
Here's how to determine the amount of financing cash flows:
Financing cash flows include activities related to debt, equity, and dividends.
- Cash inflow from issuing common stock: + $54,000
- Cash outflow from repaying borrowed amounts: - $82,000
- Cash outflow from paying dividends: - $5,900
Total Financing Cash Flows = $54,000 - $82,000 - $5,900 = -$33,900
The company will report -$33,900 in financing cash flows for the current year. This indicates a net outflow of cash from financing activities.