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Anna11 [10]
2 years ago
15

If a firm has $300,000 in cash flow from assets and $100,000 in cash flow to shareholders, what is the cash flow to creditors?

Business
1 answer:
Oxana [17]2 years ago
8 0

The cash flow from assets must equal the sum of the cash flow to creditors plus shareholders.

CF from Assets = CF to Shareholders plus CF to Creditors.

CF From assets = CF to Shareholders + CF to creditors.

CF from assets - CF to Shareholders = CF to creditors.

Thus, 300,000 - 100,000 = 200,000.

What is cash flow (CF)?

One of the areas on the cash flow statement that details how much money was made or spent on various investment-related activities during a given time period is the cash flow from investing activities (CFI) section. Purchases of tangible assets, investments in securities, and sales of assets or securities are all examples of investing activities.

A company's poor performance is frequently indicated by negative cash flow. Negative cash flow from investing activities, however, could be the result of significant sums of money being spent on things like R&D that are essential to the company's long-term success.

It's crucial to understand where an organization's investment activity fits into its financial statements before analyzing the various positive and negative cash flows from investing activities.

The balance sheet gives a summary of the assets, liabilities, and owner equity of a company as of a particular date. An overview of the company's earnings and outlays for a time period is given by the income statement. By displaying how much money is made or spent on operating, investing, and financing activities over a given time period, the cash flow statement fills the gap between the income statement and the balance sheet.

Thus, $200,000 is cash flow to creditors.

For more information on Cash Flow, refer to the given link:

brainly.com/question/28238360

#SPF4

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Describe the final step in the adjusting process. The final step is to determine the correct balance of an account. The final st
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Explanation:

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The Smith Company manufactures insulated windows. Costs for March were as follows. Direct labor $53,000 Indirect labor 18,000 Sa
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$27,000

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The following costs were incurred by Smith's company during the month of March

Direct labor $53,000

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Indirect materials 4,000

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