Question

Company X paid Company Y $1.85 million for a new plant. During the same accounting period, Company X experienced the following changes in its balance sheet: Cash decreased by $353,000, Accounts Receivable increased by $321,800, Inventory increased by $276,300, Property, Plant, and Equipment increased by $753,400, and Bonds Payable increased by $2 million. The net cash flow provided by financing activities is:

Answer 1

An Inflow of $2 million

Step-by-step explanation:

Financing Activities involve the sourcing of capital and the repayment thereoff.

Only item that belongs to financing activities is the Increase in Bonds Payable by $2 million which presents a Cash Inflow.

The net cash flow provided by financing activities is: An Inflow of $2 million