CFA Practice Question

There are 534 practice questions for this study session.

CFA Practice Question

An analysis of noncash accounts disclosed the following:

a. Machinery was purchased for $4,500 cash.
b. $10,000 was borrowed on a long-term note.
c. 1,000 shares of common stock were issued at $5 each.
d. Cash dividends of $2,000 were declared and paid.
e. An investment was sold for $23,000.
f. $50,000 of bonds was retired at maturity.

The net cash provided by (or used in) financing activities was which of the following?
A. A $14,000 increase
B. A $37,000 decrease
C. A $23,000 increase
Explanation: Cash provided by financing activities was (b) and (c): $10,000 + $5,000. Cash used in financing activities was (d) and (f): $2,000 + $50,000. Net cash flows used in financing activities: $15,000 - $52,000, a net decrease of $37,000.

User Contributed Comments 1

User Comment
Shelton CFF=10k+5k-2k-50k=-37k
CFI=-4.5k+23k=18.5k
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