Lopez Corp uses the indirect method to prepare its statement of cash flows

Question

Refer to the following information for 2017:

1. Long-Term Notes Payable, beginning balance, $85,000
2. Long-Term Notes Payable, ending balance, $71,000
3. Common Stock, beginning balance, $3,100
4. Common Stock, ending balance, $27,000
5. Retained Earnings, beginning balance, $76,000
6. Retained Earnings, ending balance, $120,000
7. Treasury Stock, beginning balance, $5,200
8. Treasury Stock, ending balance, $10,100
9. No stock was retired.
10. No treasury stock was sold.
11. During 2016, the company repaid $37,000 of long-term notes payable.
12. During 2016, the company borrowed $51,000 on a new note payable.
13. Net income for the year was $54,000.
14. Assume all dividends declared during the year were paid.

What is the net cash flow from financing activities?
A) $19,000
B) $9,000
C) ($14,000 )
D) $23,000

Answer 1

D .D)
Long-term Notes Payable repaid $ (37,000 )
Long-term Notes Payable borrowed 51,000
Issued Common Stock 23,900
Dividends paid ($76,000 + $54,000 - $120,000 ) (10,000 )
Purchased Treasury Stock (4,900 )
Net Cash from Financing Activities $23,000