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in preparation for developing its statement of cash flows for the year ended december 31, 2021, rapid pac, inc., collected the following information: ($ in millions) fair value of shares issued in a stock dividend $ 108.0 payment for the early extinguishment of long-term bonds (book value: $91.0 million) 96.0 proceeds from the sale of treasury stock (cost: $27.0 million) 32.0 gain on sale of land 3.6 proceeds from sale of land 10.8 purchase of microsoft common stock 162.0 declaration of cash dividends 61.0 distribution of cash dividends declared in 2020 58.0

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$151.2 in cash is used for investing activities.

Financing Activities have used $122.0 in cash.

To allocate the cash transactions that take place during the year, a cash flow statement is created. It falls into three categories: operational cash flow, investing cash flow, and financing cash flow.

Changes to the non-current assets on the balance sheet are included in the investing activities section. Capitalization of fixed assets, as well as other varied investments and goodwill, are included in this.

Proceeds from the sale of the land               10.8

Purchases of Microsoft common stock     (162.0)

Total Cash Utilized from investing activities   $151.2

The non-current liabilities and equity parts of the balance sheet items that have changed are included in the financing activities section. The section provides information about the company's funding sources and expansion prospects.

Payment for the early extinguishment of long-term

bonds (book value: $91.0 million)                                                (96.0)

Proceeds from the sale of treasury stock

(cost: $27.0 million)                                                                 32.0

Distribution of cash dividends declared in 2015                        (58.0)

Total Cash Utilized from Financing Activities                        (122.0)

  • Although it would be noted on the statement, the declaration of a $61 cash dividend has no effect on cash until it is paid.
  • The fair value of shares issued in connection with the stock dividend is $108.0: This would not apply to the cash flow statement but should be included for clarity. A stock split redistributes retained earnings already held by the business; actual cash is neither brought in nor taken out.
  • Gain on sale of land $3.6: This gain would be included in the income statement portion of the cash flow statement, which is found in the section of the statement devoted to operating operations.

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