- CFA Exams
- CFA Level I Exam
- Topic 3. Financial Statement Analysis
- Learning Module 20. Understanding Cash Flow Statements
- Subject 1. Classification of Cash Flows and Non-Cash Activities
CFA Practice Question
Assume GAAP.
Retirement of common stock: 38
Cash payments to merchandise suppliers: 85
Sale of equipment: 35
Payment of dividends: 38
Purchase of land: 10
Cash payment for salaries: 38
Cash collections from customers: 271
Purchase of equipment: 45
Cash payments for interest: 15
Retirement of common stock: 38
Cash payments to merchandise suppliers: 85
Sale of equipment: 35
Payment of dividends: 38
Purchase of land: 10
Cash payment for salaries: 38
Cash collections from customers: 271
Purchase of equipment: 45
What are cash flows from investing activities?
A. -20
B. 0
C. 70
Explanation: Cash flows from investing activities = sale of equipment - purchase of land - purchase of equipment
(35 - 10 - 45) = -20
User Contributed Comments 2
| User | Comment |
|---|---|
| achu | PPE items are CFI not CFO. |
| homersimpson | Interest paid ... operating cashflow |