Question

Assume that the Fitzgerald Corporation uses the indirect method to depict cash flows. Indicate where, if at all, a stock dividend declared and issued would be classified on the statement of cash flows.

a. Does not represent a cash flow.
b. Financing activities section.
c. Investing activities section.
d. Operating activities section.

Answer 1

b. Financing activities section.

Step-by-step explanation:

Paid dividends are part of the financing activities of a cash flow statement since they affect the company's paid in capital. This section also includes any stocks issued or repurchased, as well as any changes in the company's long term debts. The company's statement of cash flows generally begins with operating cash flows, then investing cash flows and finally financing cash flows.