Use the following codes to indicate how the cash flow effect, if any, of each transaction would be reported on a statement of cash flows if the operating activities section is prepared using the direct method. (Choices may be used more than once.)
-Paid the cash dividends.
A)Inflow from operating activity
B)Outflow from operating activity
C)Inflow from investing activity
D)Outflow from investing activity
E)Inflow from financing activity
F)Outflow from financing activity
G)Noncash investing and financing activity
H)Not reported on statement of cash flows

Question

Quizplus · Accepted Answer

Paying cash dividends is considered an outflow from financing activities because it represents a return of capital to the shareholders.

Use the Following Codes to Indicate How the Cash Flow