Georgia Company Has the Following Data Available No Dividends Were Declared or Paid for the Year Ending

question 63

Multiple Choice

Georgia Company has the following data available:
$\begin{array}{lll}&\text { December } & \text { December } \\&31,2011 & 31,2012\\\text { Fixed Assets } & \$ 125 & \$ 125 \\\text { Accumulated Depreciation } & \$ 110 & \$ 117 \\\text { Long-term debt } & \$ 125 & \$ 5 \\\text { Commonstock } & \$ 300 & \$ 400 \\\text { Retained earnings } & \$ 100 & \$ 120\end{array}$
No dividends were declared or paid for the year ending December 31,2012.What is the net cash flow from financing activities for the year ended December 31,2012?

• A) $20 cash inflow
• B) $20 cash outflow
• C) $100 cash inflow
• D) $120 cash outflow

---

Definitions:

Equity Method

An accounting technique used to record investments in other companies, where the investment's value is adjusted to reflect the investor's share of the company's post-acquisition earnings or losses.

Gross Profit

The difference between revenue and the cost of goods sold, before deducting overheads, salaries, and other operating expenses.