A company has a net cash inflow from operating activities of $794,000, a net cash outflow of $60,000 from investing activities and a net cash inflow of $100,900 from financing activities. The company paid $129,000 in interest, $189,000 in income taxes, and $205,000 in cash dividends. Which of the following statements about the statement of cash flows is not correct?
A. Supplemental disclosures required for a company using the indirect method include the amount of interest and the amount of income taxes paid.
B. The cash dividends of $205,000 paid will be reported as a cash outflow in the cash flow from investing activities section.
C. The statement of cash flows will show a net increase in cash and cash equivalents of $834,900.
D. If the direct method is used, the $129,000 of interest paid and the $189,000 of income taxes paid will be reported in the cash flows from operating activities.
Answer: B
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