Consider the cash flow statement of a company XYZ Inc. for the year ended December 31, 2023. The cash flow statement categorizes cash flows into three main sections: operating activities, investing activities, and financing activities. During the year, the following transactions occurred: XYZ Inc. had a net income of $150,000. Depreciation expenses amounted to $30,000. The company sold equipment for $20,000 which had a book value of $12,000. XYZ Inc. issued new shares totaling $50,000. Payment of dividends was $10,000. Based on these transactions, which of the following options correctly identifies the total cash flows from operating activities that should be reported in the cash flow statement?

Exam

CFA Level 1

Section

Difficulty

Financial Reporting and Analysis

Calculate Cash Flows from Operating Activities

Hard Financial Statements Cash Flow Statement

Consider the cash flow statement of a company XYZ Inc. for the year ended December 31, 2023. The cash flow statement categorizes cash flows into three main sections: operating activities, investing activities, and financing activities.

During the year, the following transactions occurred:

XYZ Inc. had a net income of $150,000.
Depreciation expenses amounted to $30,000.
The company sold equipment for $20,000 which had a book value of $12,000.
XYZ Inc. issued new shares totaling $50,000.
Payment of dividends was $10,000.

Based on these transactions, which of the following options correctly identifies the total cash flows from operating activities that should be reported in the cash flow statement?

Total Cash Flows from Operating Activities: $150,000

Total Cash Flows from Operating Activities: $180,000

Total Cash Flows from Operating Activities: $210,000

Hint

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