- CFA Exams
- CFA Level I Exam
- Study Session 7. Financial Reporting and Analysis (2)
- Reading 23. Understanding Cash Flow Statements
- Subject 1. Classification of Cash Flows and Non-Cash Activities
CFA Practice Question
Assume GAAP.
Retirement of common stock: 40
Cash payments to merchandise suppliers: 93
Sale of equipment: 31
Payment of dividends: 38
Purchase of land: 9
Cash payment for salaries: 40
Cash collections from customers: 265
Purchase of equipment: 44
Cash payments for interest: 15
Retirement of common stock: 40
Cash payments to merchandise suppliers: 93
Sale of equipment: 31
Payment of dividends: 38
Purchase of land: 9
Cash payment for salaries: 40
Cash collections from customers: 265
Purchase of equipment: 44
What are cash flows from financing activities?
A. -78
B. 78
C. 2
Explanation: CFF = Outflow from retirement of common stock = 40
Outflow from payment of dividends = 38
Total: -78
Outflow from payment of dividends = 38
Total: -78
User Contributed Comments 6
| User | Comment |
|---|---|
| Terry | how about the cash payments for interest? |
| lilbut | interest is in cfo, not cff |
| jpducros | when not specified, consider we are in US Gaap... |
| shiva5555 | So this is payment of dividends and retirement of common stock correct? |
| siggarusfigs | no jpducros, we assume IFRS if not specified |
| rjdelong | no jpducros is correct assume GAAP if not stated, but it is stated right at the top of the question you are in GAAP on this question |