Cash flows from financing in the statement of cash flows would include which of the following?1 pointPaying salaries for the monthPurchase of landPaying dividends to shareholdersSelling goods or services to customers
Question
Cash flows from financing in the statement of cash flows would include which of the following?1 pointPaying salaries for the monthPurchase of landPaying dividends to shareholdersSelling goods or services to customers
Solution
The cash flows from financing in the statement of cash flows would include "Paying dividends to shareholders". This is because this activity involves the movement of money to finance the business's operations and growth.
Here's a step-by-step breakdown:
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Paying salaries for the month: This is an operational activity, not a financing activity. Salaries are part of the day-to-day operations of a business.
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Purchase of land: This is an investing activity, not a financing activity. The purchase of land is an investment in a long-term asset.
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Paying dividends to shareholders: This is a financing activity. Dividends are payments made to shareholders from the company's profits. This is a way of financing the business because it involves the distribution of profits back to the investors.
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Selling goods or services to customers: This is an operational activity, not a financing activity. Selling goods or services is the primary way a business generates revenue, which is part of its operations.
So, the correct answer is "Paying dividends to shareholders".
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