In the first year of business, Exeter Company had the following activity: The sh

Question

In the first year of business, Exeter Company had the following activity:

The shareholder contributed $100,000 in exchange for stock.

Sales on credit were $50,000.  Accounts receivable at the end of the year was $4,200.

Salaries and rent of $10,000 were paid during the year.

Dividends of $1,000 were paid to the shareholder.

On the Year1 Statement of cash flows, what would be reported as total cash flows from operating activities?

A. $40,000

B. $34,800

$39,000

$35,800

$134,800

B. $34,800

$39,000

$35,800

$134,800

Explanation / Answer

Cash flows from operating activities = 50000-4200-10000= $35800 Option D is correct

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