B is corrent because net cash from investing activities is computed as the cash proceeds from the sale of investment in Blue Co. less the cash used for the common stock purchase from Brown Co. or $37,000 ($75,000 – $38,000). The dividends received on Grey Co. stock would be included in net cash flows from operating activities.
A is incorrect. Net cash from investing activities is computed as the cash proceeds from the sale of investment in Blue Co. less the cash used for the common stock purchase from Brown Co. or $37,000 ($75,000 – $38,000). The dividends received on Grey Co. stock would be included in net cash flows from operating activities.
C is incorrect. Net cash from investing activities is computed as the cash proceeds from the sale of investment in Blue Co. less the cash used for the common stock purchase from Brown Co. or $37,000 ($75,000 – $38,000). The dividends received on Grey Co. stock would be included in net cash flows from operating activities.
D is incorrect. Net cash from investing activities is computed as the cash proceeds from the sale of investment in Blue Co. less the cash used for the common stock purchase from Brown Co. or $37,000 ($75,000 – $38,000). The dividends received on Grey Co. stock would be included in net cash flows from operating activities.
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