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cash outflow to the government for taxes. cash outflow to shareholders as dividends. cash outflow to lenders as interest. cash outflow to purchase bonds issued by another company.
As per IAS7, Interest and dividend received and paid may be classified as operating, investing, or financing cash flows, provided that they are classified consistently from period to period.
Cash flow arising from taxes on income are normally classified as operating, unless they can be specifically identified with financing or investing activities.
Cash outflow to shareholders as dividend and cash outflow to lenders as interest are the correct answer in the light of the above explaination as per IAS-7.
cash outflow to the government for taxes. ( Is Operating Activity )cash outflow to shareholders as dividends. ( Is Financing Activity ) cash outflow to lenders as interest. ( Is Operating Activity )cash outflow to purchase bonds issued by another company. ( Is Investing Activity )
Operating Activity: Cash outflow to the government for taxes.
Financing Activity: Cash outflow to shareholders as dividends.
Financing Activity: Cash outflow to lenders as interest.
Investing Activity: Cash outflow to purchase bonds issued by another co.
Note:
The above may be classified differently if the company itself is a Finance or a Banking company or Non Banking Financial Institution, and if there is a change from outflows to inflows.
cash outflow to shareholders as dividends.
cash outflow to lenders as interest.
Cash outflow to purchase Bonds issued by another company
cash outflow to shareholders as dividends.
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