Question

Creative Sound Systems sold investments, land, and its own common stock for $38 million, $15.8 million, and $41.6 million, respectively. Creative Sound Systems also purchased treasury stock, equipment, and a patent for $21.8 million, $25.8 million, and $12.8 million, respectively. What amount should the company report as net cash flows from investing activities? (List cash outflows and any decrease in cash as negative amounts. Enter your answer in millions. (i.e., $10,000,000 should be entered as 10).)

Answer 1

Answer:

net cash flow from the financial activities = $ 41.6 - $ 21.8 = $ 19.8

Explanation:

Given:

Income raised by selling

$ 38 million from investment

$ 15.8 million from the land

$ 41.6 million from the common stock

also,

the amount paid

$ 21.8 million for treasury stock

$ 25.8 million for equipment

$ 12.8 million for patent

Now,

the net cash flow is counted for the financial activities i.e the buying and selling of the stocks and the other activities done belongs to the investment activities

thus,

the net cash flow from the financial activities = $ 41.6 - $ 21.8 = $ 19.8