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

question 105

Multiple Choice

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

• A)
• Cash provided by investing activities, \( \$ 11,000 \)
• Cash provided by financing activities, \( \$ 80,000 \)
• 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)
• Cash used by investing activities, \( \$ 25,000 \)
• Cash used by financing activities, \( \$ 36,000 \)
• E)
• Cash provided by investing activities, \( \$ 36,000 \)
• Cash provided by financing activities, \( \$ 80,000 \)

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Definitions:

Bundles

Combinations of goods or services sold as a single package, often at a discounted rate compared to purchasing each item separately.

Indifferent

A state of having no preference between two or more alternatives, reflected in decision-making and consumer choice theory.

Marginal Rate

The marginal rate typically refers to the rate at which the next dollar of taxable income is taxed.

Substitution

The economic principle that as the price of a good or service increases, consumers are likely to replace it with a cheaper alternative.