Which of the following is an outflow of cash?
A) Profitable operations
B) The sale of equipment
C) The sale of the company's common stock
D) The payment of cash dividends

Question

Quizplus · Accepted Answer

Outflow of cash means any transaction that results in a decrease in cash balance. Payment of cash dividends means the company is paying its shareholders, which will lead to a decrease in the company's cash balance. Therefore, option D is the correct answer. Option A (profitable operations) could be an inflow or outflow of cash depending on the nature of the operations. Option B (sale of equipment) and option C (sale of common stock) are both inflows of cash.

Which of the Following Is an Outflow of Cash