Asked by Lawrence Woods on May 14, 2024
Verified
In preparing Tywin Company's statement of cash flows for the most recent year,the following information is available: Net cash flows from investing activities for the year were:
A) $438,000 of net cash used.
B) $438,000 of net cash provided.
C) $264,000 of net cash used.
D) $351,000 of net cash used.
E) $264,000 of net cash provided.
Investing Activities
Transactions involving the purchase and sale of long-term assets and other investments not considered cash equivalents.
Net Cash
The amount of cash remaining after all operating, investing, and financing activities have been accounted for over a specific period.
- Grasp the essentials and preparation methods for the statement of cash flows.
- Appraise changes in non-operating assets, long-term liabilities, and equity to determine the movement of cash from investing and financing operations.
Verified Answer
AC
Asisipho CenganiMay 20, 2024
Final Answer :
C
Explanation :
The question does not provide any information that directly relates to net cash flows from investing activities. Therefore, we can assume that we need to calculate this figure using other information provided in the statement of cash flows. One way to do this is to use the formula: Net cash flows from investing activities = Cash inflows from investing activities - Cash outflows from investing activities. By looking at the statement of cash flows, we can see that there were cash outflows of $264,000 for the purchase of property, plant, and equipment. Therefore, the net cash flows from investing activities would be $264,000 of net cash used (or cash outflows), which is option C.
Learning Objectives
- Grasp the essentials and preparation methods for the statement of cash flows.
- Appraise changes in non-operating assets, long-term liabilities, and equity to determine the movement of cash from investing and financing operations.
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