Question

Rowdy's Restaurants Cash Flow (in millions): (questions 1-4) CASH RECEIVED FROM: Customers on Sales Interest on investments $1800 $200 Sale of land $100 $600 $2000 Sale of capital stock Insurance of debt securities (borrowings) CASH PAID FOR: Interest on debt Income tax expense Debt principal reduction (repayment of debt) Purchase of equipment Purchase of inventory Dividends on capital stock Operating expenses $300 $80 $1500 $4000 $1000 $200 $500 1. Rowdy's would report net cash inflows (outflows) from operating activities in the amount of A) $(80) B) $120 C) $200 D) $420 2. Rowdy's would report net cash inflows (outflows) from investing activities in the amount of A) $(4,000) B) $100 C) $(3,900) D) S(1,900) 3. Rowdy's would report net cash inflows (outflows) from financing activities in the amount of A) $1,100 B) S(1,100) C) $820 D) $900 4. Rowdy's would report net increase (decrease) in cash during the current period: A) $4,920 B) $3,020 c) S(2,880) D) $5,000

Answer 1

Cash flow from Operating Activities Cash flow from Investing Activities Cash flow from Financing Activities Cash Inflow 1800 Sale of Land 600 Customers on sale Interest on Investment 100 Sale of Capital Stock Insurance of debt securities 200 2000 Cash Outflow Income Tax Expenses Purchase of Inventory Operating Expenses Interest on Debt -80 Purchase of Euipments -1000 -500 -300 -4000 Debt Principal Redemption Dividend on Capital Stock -1500 -200 Net Cashflow 120 -3900 900 -2880 Operating activities are the day to day Cash flow from the purchase or disposal of bussiness activities performed by company, to investment or any long term assets catagories attain its objective as investing activities Cash flow from equity or borrowing will be termed as Financing activities Answers 120 -3900 900 -2880 w