Question

Oering's Furniture Corporation is a Virginia-based manufacturer of furniture. In a recent year, it reported the following activities:

Net income	$	5,152
Purchase of property, plant, and equipment		1,073
Borrowings under line of credit (bank)		1,119
Proceeds from issuance of stock		12
Cash received from customers		37,177
Payments to reduce long-term debt		62
Sale of marketable securities		233
Proceeds from sale of property and equipment		6,892
Dividends paid		290
Interest paid		96
Purchase of treasury stock (stock repurchase)		2,577

Required:

Based on this information, present the cash flows from investing and financing activities sections of the cash flow statement. (List cash outflows as negative amounts.)

Answer 1

(i)

Cash flows from investing activities
Purchase of property, plant, and equipment	- 1,073
Sale of marketable securities	233
Proceeds from sale of property and equipment	6,892
Net cash flows from investing activities	$6,052

(ii)

Cash flows from financing activities
Borrowings under line of credit (bank)	1,119
Proceeds from issuance of stock	12
Payments to reduce long-term debt	- 62
Dividends paid	- 290
Purchase of treasury stock (stock repurchase)	- 2,577
Net cash used in financing activities	- $1,798

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