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marin [14]
3 years ago
12

Exercise 11-13A Calculate financing cash flows (LO11-5) Dristell Inc. had the following activities during the year (all transact

ions are for cash unless stated otherwise): A building with a book value of $400,000 was sold for $500,000. Additional common stock was issued for $160,000. Dristell purchased its own common stock as treasury stock at a cost of $75,000. Land was acquired by issuing a 6%, 10-year, $750,000 note payable to the seller. A dividend of $40,000 was paid to shareholders. An investment in Fleet Corp.’s common stock was made for $120,000. New equipment was purchased for $65,000. A $90,000 note payable issued three years ago was paid in full. A loan for $100,000 was made to one of Dristell’s suppliers. The supplier plans to repay Dristell this amount plus 10% interest within 18 months. Required: Calculate net cash flows from financing activities. (Cash outflows should be indicated with a minus sign.)
Business
1 answer:
Scilla [17]3 years ago
3 0

Answer:

The net cash flows from financing activities is -$45,000

Explanation:

The computation of the net cash flows from financing activities is shown below:

=  Additional common stock issued - purchase of treasury stock - dividend paid - long term note payable issued

= $160,000 - $75,000 - $40,000 - $90,000

= -$45,000

The other items which are mentioned in the question have come under the investing activities

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Financing cash flows in the statement of cash flows would include which of the following?
iVinArrow [24]

Answer:

c. Repayment of long-term borrowing to the bank.

Explanation:

The third section of the statement of cash flows shows the cash flows from financing activities. These activities are defined as ‘activities that result in changes in the size and composition  of the contributed equity and borrowings of the entity.’ It measures the flow of cash between a firm  and its owners and creditors. Companies often borrow money to fund their operations, acquire  another company or make other major purchases. Here again for investors, the most important  item is cash dividends paid.

Based on the above discussion, the following item shall be included in the financing cash flows.

c. Repayment of long-term borrowing to the bank.

4 0
2 years ago
John buys a watch for $100 at a vintage store. Later, the store learns that the watch was worn by Sean Connery in a James Bond m
ivann1987 [24]

Answer

The store cannot rescind their decision because the ownership of the goods has passed from the seller to the buyer in this case john

Explanation :This can be defined as a situation whereby the seller agree to sell the goods to the buyer in exchange for value known as money.in contract for the sale of goods, there is sale and agreement to sale. Sale is when the seller has agreed to sell the goods to the buyer in exchange for value known as money and the buyer has actually made payment for the goods.in this case, the ownership of the goods has passed from the seller to the buyer.

On the other hand,agreement to sale is when the seller has agreed to sell the goods to the buyer in exchange for money but the buyer has not made the payment. In this case,the ownership of the goods is still with the seller . Therefore, in the case of John who is a subject of our discussion, John has bought the watch from the store and made payment for it.John has the right to enjoy the watch under the law. If the seller now wants to deny John the right to have value for his money.John had the right to seek redress in the court of law in defence of his right to have value for money by enjoying the watch which he had bought from the store with his hard earned money.

3 0
3 years ago
The cost of producing a good and getting it to the customers is called the _____ . penalty cost
Free_Kalibri [48]
I believe the answer is accounting cost. good luck
5 0
2 years ago
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Which one of the following statements is correct concerning the payback rule?
Naya [18.7K]

The correct concerning the payback rule is rule is flawed because it ignores all cash flows after some arbitrary point in time.

Payback period in capital budgeting refers to the time required to recover funds spent on an investment or to reach breakeven. Example: If at the beginning of year 1 he invests $1,000 and at the end of year 1 and his second year he earns $500, it pays for itself within 2 years.

The number of years it will take to recover the money invested. For example, if it takes 5 years to recover the cost of an investment, the payback period is he 5 years.

Payback period is defined as the number of years required to recover the original cash investment. In other words, the period during which a machine, plant, or other investment has generated sufficient net income to cover its investment costs.

Learn more about Payback period brainly.com/question/23149718

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7 0
11 months ago
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Ilia_Sergeevich [38]

Answer:

Closed facts.

Explanation:

In a situation of close facts the action has already been taken before now, and the researcher is to analyse it and determine best course of action.

On the other hand when there is an open fact situation the action has not taken place yet, and the future action can be influenced to give a favorable result.

For example Jeremy has identified a research question that relates to a transaction that the client completed several months ago. This is a closed fact situation.

5 0
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