The following information is taken from the financial statements of Cyrus Ltd for the year ended 30 June 2016.
-Dividends of $100 000 were declared during the year,and the balances in the dividends payable account at the beginning and end of the year were $15 000 and $25 000 respectively.What amount would be reported as payment of dividends in the cash flows from the financing activities section of the statement of cash flows?
A) $90 000
B) $25 000
C) $100 000
D) $110 000

Question

The following information is taken from the financial statements of Cyrus Ltd for the year ended 30 June 2016.  
-Dividends of $100 000 were declared during the year,and the balances in the dividends payable account at the beginning and end of the year were $15 000 and $25 000 respectively.What amount would be reported as payment of dividends in the cash flows from the financing activities section of the statement of cash flows?
A) $90 000 
B) $25 000 
C) $100 000 
D) $110 000

Quizplus · Accepted Answer

The payment of dividends is calculated as the declared dividends minus the increase in dividends payable: $100,000 - ($25,000 - $15,000) = $90,000.

The Following Information Is Taken from the Financial Statements of Cyrus