Question

Rowdy's Restaurants cash flow ($ in millions) Cash received from: Customers $ 2,550 Interest on investm...

Rowdy's Restaurants cash flow ($ in millions)

Cash received from:
Customers $ 2,550
Interest on investments 250
Sale of land 150
Sale of Rowdy's capital stock 700
Issuance of debt securities 2,500
Cash paid for:
Interest on debt $ 350
Income tax 130
Debt principal reduction 2,000
Purchase of equipment 5,000
Purchase of inventory 1,500
Dividends on capital stock 350
Operating expenses 600


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

Multiple Choice

  • $(130) million.

  • $220 million.

  • $350 million.

  • $570 million.

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Answer #1

Answer-Rowdy's would report net cash inflows from operating activities in the amount of = $220 million.

Explanation- Net cash inflows from operating activities =Cash received from customers+ Interest on investments-Interest on debt- Income tax paid-Purchase of inventory- Operating expenses paid

= $2550+$250-$350-$130-$1500-$600

= $220 million

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