Question

Rowdy's Restaurants cash flow ($ in millions) Cash received from: Customers $ 3,600 Interest on investments...

Rowdy's Restaurants cash flow ($ in millions)

Cash received from:
Customers $ 3,600
Interest on investments 320
Sale of land 220
Sale of Rowdy's capital stock 840
Issuance of debt securities 3,200
Cash paid for:
Interest on debt $ 420
Income tax 200
Debt principal reduction 2,700
Purchase of equipment 6,400
Purchase of inventory 2,200
Dividends on capital stock 560
Operating expenses 740


Rowdy's would report net cash inflows (outflows) from investing activities in the amount of:

Multiple Choice

  • $220 million.

  • $(2,980) million.

  • $(6,180) million.

  • $(6,400) million.

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Answer #1

Net cash flow from investing activities = Cash received from sale of land - Cash paid for purchase of equipment

Net cash flow from investing activities = $220 - 6,400 = $(6,180) million.

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