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25 July, 18:14

Stimpleton Company engages in the following cash payments:

Purchase equipment $4,000

Pay rent 700

Repay loan to the bank 5,900

Pay workers' salaries 1,050

What is the total amount of cash paid for operating activities?

A.$1,750

B.$4,000

C.$6,950

D.$9,900

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Answers (1)
  1. 25 July, 18:26
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    Answer: Option A

    Explanation: Operating activities refers to those activities which are directly related to the core operations of the business. Such transactions are important for running the business and recorded at the top in cash flow statements.

    Thus, only payment of rent and workers salary will be considered operating activities and the company will be having total of $1750 of cash outflow.

    Hence the correct option is A.
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Home » Business » Stimpleton Company engages in the following cash payments: Purchase equipment $4,000 Pay rent 700 Repay loan to the bank 5,900 Pay workers' salaries 1,050 What is the total amount of cash paid for operating activities? A.$1,750 B.$4,000 C.$6,950 D.
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