Final answer:
The net cash flow from financing activities for the Friedman Company is $65,000, calculated by subtracting the sum of net cash inflows from operating and investing activities from the total net increase in cash equivalents.
Step-by-step explanation:
The Friedman Company's statement of cash flows includes several key components: the net increase in cash equivalents, the net cash inflow from operating activities, and the net cash inflow from investing activities. To calculate the net cash flow from financing activities, one must understand the basic formula for a statement of cash flows:
Net Increase in Cash = Cash from Operating Activities + Cash from Investing Activities + Cash from Financing Activities
Let's use the provided data to solve for the unknown, which is the net cash flow from financing activities:
Net Increase in Cash Equivalents = $100,000
Net Cash Inflow from Operating Activities = $20,000
Net Cash Inflow from Investing Activities = $15,000
Now, we will plug these values into our cash flow equation:
$100,000 (Net Increase in Cash) = $20,000 (Operating Activities) + $15,000 (Investing Activities) + X (Financing Activities)
By rearranging the equation and solving for X, we get:
$100,000 = $20,000 + $15,000 + X
$100,000 = $35,000 + X
X = $100,000 - $35,000
X = $65,000
Therefore, the net cash flow from financing activities that will be reported on the statement of cash flows is $65,000.