Certified Auto Parts Company Uses the Indirect Method to Prepare

question 48

Multiple Choice

Certified Auto Parts Company uses the indirect method to prepare its statement of cash flows.Refer to the following information for 2017:
Net cash provided by operating activities: $109,000
Net cash used for investing activities: $(115,500)
Net cash provided by financing activities: $18,000
If the cash balance at the beginning of the year was $13,200,what is the ending cash balance?

• A)$24,700
• B)$11,500
• C)$13,200
• D)$6,500

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Definitions:

Common Stock

A type of equity security that represents ownership in a corporation, with rights to vote on corporate policy and receive dividends.

Liquidation

The process of winding up a company's operations and distributing its assets to claimants, typically occurring when the company is insolvent.

Preferred Shareholders

Investors who own preferred shares in a company, which often grant them priority over common shareholders in dividend payments and asset liquidation.

Dividend Growth Model

The dividend growth model is a valuation method used to estimate the price of a company's stock based on the assumption that dividends will increase at a steady rate indefinitely.