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Upon review of Make Your Mark, Inc.s Statement of Cash Flows, the following was noted: Cash Flows from Operating Activities
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Answer #1

The implications which can be noted are as follows:

  1. Cash flow from operations means the profit/loss from the business. A cash inflow implies a cash inflow from operations while a cash outflow signifies a loss.

Here, $15,000(being Profit) signifies a cash inflow from operations.

  1. Cash flows from investing activities means the sale or purchase of long term assets/investments pf the company. A sale result in cash inflow while a purchase result in cash outflow,

Here, ($80000) denotes that there is a purchase of a long-term asset.

  1. Cash flow from investing activities denotes issue/repayment of bonds or shares or long term liabilities. It also includes payment of interest or dividend. Issue of bonds/Shares or Loans taken show a cash inflow. While Repayment of bonds/loans or buyback of shares or payment of interest or dividend shows a cash outflow.

Here,$60,000 shows that common stock is issued during the year.

In the given case As per the analysis of given information & implications above.

The correct answer is Option (B): using cash from operations and issuing common stock to purchase long term assets.

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