Question

Milliken Company paid $2.2 million to purchase stock in another company, $1.0 million to repurchase treasury shares, $0.5 million to buy short-term investments, sold used equipment for $0.8 million when its book value was $0.6 million, and purchased new equipment for $3.4 million. What was the net cash flow from investing activities? $6.3 million net cash outflow. $5.3 million net cash outflow. $5.1 million net cash outflow. $4.8 million net cash outflow.

Answer 1

Answer:

Net cash flow from investing activities -$5.3 million

Explanation:

The computation of the net cash flow from investing activities is shown below:

Purchase stock -$2.2 million

Short term investment purchase -$0.5 million

Sold equipment $0.8 million

Purchase new equipment -$3.4 million

Net cash flow from investing activities -$5.3 million