Reference no: EM132601719

Question 1: Red Ox Corporation's net income for the year ended December 31, 20X4, was $128,000. Red Ox has elected to report any interest paid as operating activities and any dividends paid as financing activities. Additional data for the 20X4 fiscal year is as follows:

• Red Ox issued a bond for $95,000.
• Depreciation expense for the 20X4 fiscal year was $12,000.
• The balance for the company's bank loan as at December 31, 20X3, was $240,000. The balance as at December 31, 20X4, was $215,000.
• Interest expense paid in the year was $3,000.
• Red Ox issued 500 common shares for $80 per share.
• Red Ox sold 10,000 shares in one of its investments, Blue Horn Inc., for $26,000.
• Red Ox declared a dividend of $16,000 that is to be paid on January 4, 20X5.

What are Red Ox's net cash inflows from financing activities for the 20X4 fiscal year?

a) $ 94,000

b) $107,000

c) $110,000

Question 2: Rockhouse Corp. reported the following on its statement of financial position:

                                   June 30, 20X5                      June 30, 20X4

Inventory                     $1,700,000                   $1,500,000

Accounts payable            $325,000                       $440,000

Salaries payable              $600,000                        $500,000

For the year ended June 30, 20X5, Rockhouse reported cost of goods sold of $3,900,000 on the statement of comprehensive income. Using the direct method, what amount would be reported by Rockhouse under the operating activities section in the statement of cash flows for the year ended June 30, 20X5, for cash paid to suppliers?

a) $3,585,000

b) $3,685,000

c) $4,115,000

d) $4,215,000