During the last year, Len Corp. generated $1,170.00 million in cash flow from operating activities and had negative cash flow generated from investing activities (-640.00 million). At the end of the first year, Len Corp. had $200 million in cash on its balance sheet, and the firm had $280 million in cash at the end of the second year. What was the firm's cash flow (CF) due to financing activities in the second year?

Question

Gaige

Business

16 January, 17:45

During the last year, Len Corp. generated $1,170.00 million in cash flow from operating activities and had negative cash flow generated from investing activities (-640.00 million). At the end of the first year, Len Corp. had $200 million in cash on its balance sheet, and the firm had $280 million in cash at the end of the second year. What was the firm's cash flow (CF) due to financing activities in the second year?

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Answers (1)

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Kara Macias · Answer 1

The firm's cash flow (CF) due to financing activities in the second year is - $450 million

Explanation:

As we know that,

Net increase in cash = Operating activity - investing activity - financing activity

where,

Net increase in cash = Ending balance of second year - ending balance of first year

= $280 million - $200 million

= $80 million

The other items values would remain the same

Now put these values to the above formula

So, the value would equal to

$80 million = $1,170 million - $640 million + financing activity

$80 million = $530 + financing activity

So, financing activity = $80 million - $530 million

= - $450 million