Crash Course in Accounting and Financial Statement Analysis, Second Edition

Components

Several accounts are typically found in the financing cash flow section (Exhibit 7.15):

• Issuance of debt: increase in the level of borrowings (cash inflow)

• Repayment of debt: decrease in the level of borrowings (cash outflow)

• Common stock issued: issuance of equity (common stock—cash inflow)

• Common stock repurchased: repurchase of equity (treasury stock—cash outflow)

• Payment of dividends: distribution of cash (cash outflow)

7. Cash Flow from Financing Activities

Exercise Q1: Cash flow from financing activities tracks the movement of cash associated with: Borrowing (paydown) of debt Issuance (repurchase) of common stock Payment of interest expense Payment of dividends

8. Cash Flow from Financing Activities

Exercise Q1: Which of the following financing activities constitute(s) cash inflows for a company? Borrowing debt Payment of dividends Repurchase of stock Issuance of common stock