- 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
Which of the following is not included in computing cash flow from operating activities?
A. Payments to lenders for interest
B. Dividends received
C. Dividends paid
Explanation: Dividends paid are included in financing activities because dividends paid provide a return to owners on their investment.
User Contributed Comments 5
| User | Comment |
|---|---|
| anand8486 | Hi, Can someone help me on option A regard to this question? Thanks |
| merc10112 | Under USGAAP: A) Interest paid =CFO B) Dividend received = CFO C) Dividend paid = CFF Thus...C |
| Frontier17 | under IFRS dividend paid could be CFO as well as CFF. |
| timkalt | Assume GAAP if not stated differently... |
| ocionesw | In such case, that the question is not referring to a particular standards, should we always assume that it is based on US GAAP? |