Question

During 2015, Stout Inc. had the following activities related to its financial operations:

Carrying value of convertible preferred stock in Stout, converted into common shares of Stout $ 360,000
Payment in 2015 of cash dividend declared in 2014 to preferred shareholders 186,000
Payment for the early retirement of long-term bonds payable (carrying amount $2,620,000) 2,650,000
Proceeds from the sale of treasury stock (on books at cost of $258,000) 300,000

The amount of net cash used in financing activities to appear in Stout's statement of cash flows for 2015 should be
During 2015, Stout Inc. had the following activiti
A. $2,176,000.
B. $2,548,000.
C. $2,536,000.
D. $1,990,000.

Answer 1

Answer: C. $2,536,000.

Step-by-step explanation:

This is the net cash spent in financing activities.

= Payment in 2015 of cash dividend declared in 2014 to preferred shareholders + Payment for the early retirement of long-term bonds payable (carrying amount $2,620,000) - Proceeds from the sale of treasury stock

= 186,000 + 2,650,000 - 300,000

= $2,536,000