Given the Following Information,determine the Amount of Cash Flows from Investing

question 35

Multiple Choice

Given the following information,determine the amount of cash flows from investing and financing activities.
$$\begin{array} { | l | r | } \hline \text { Net income } & \$ 70,000 \\\hline \text { Loss on sale of plant assets } & 25,000 \\\hline \text { Cash received from sale of plant assets } & \mathbf { 3 6 , 0 0 0 } \\\hline \text { Cash received from issuing stock } & \mathbf { 8 0 , 0 0 0 } \\\hline \text { Increase in income taxes payable } & \mathbf { 2 0 , 0 0 0 } \\\hline\end{array}$$

• A) \(\begin{array}{|l|}
• \hline\text { Cash provided by investing activities, } \$ 11,000 \\
• \hline \text { Cash provided by financing activities, } \$ 80,000 \\
• \hline
• \end{array}\)
• B) Cash used by investing activities, \( \$ 80,000 \)
• Cash used by financing activities, \( \$ 11,000 \)
• C) Cash provided by investing activities, \( \$ 80,000 \)
• Cash provided by financing activities, \( \$ 36,000 \)
• D) \(\begin{array}{|l|}
• \hline\text { Cash used by investing activities, } \$ 25,000 \\
• \hline \text { Cash used by financing activities, } \$ 36,000 \\
• \hline
• \end{array}\)
• E) \(\begin{array}{|l|}
• \hline \text { Cash provided by investing activities, } \$ 36,000 \\
• \hline \text { Cash provided by financing activities, } \$ 80,000 \\
• \hline
• \end{array}\)

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Definitions:

Constant Growth

A model assuming a company's dividends will continue to grow at a consistent rate indefinitely.

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A portion of a company's earnings that is paid to shareholders, usually on a regular basis.

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