During the last year, Len Corp. generated $1,170.00 million in cash flow from operating activities and had negative cash flow generated from investing activities (-640.00 million). At the end of the first year, Len Corp. had $200 million in cash on its balance sheet, and the firm had $280 million in cash at the end of the second year. What was the firm's cash flow (CF) due to financing activities in the second year?

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14 February, 08:08

During the last year, Len Corp. generated $1,170.00 million in cash flow from operating activities and had negative cash flow generated from investing activities (-640.00 million). At the end of the first year, Len Corp. had $200 million in cash on its balance sheet, and the firm had $280 million in cash at the end of the second year. What was the firm's cash flow (CF) due to financing activities in the second year?

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Kayla Velez · Answer 1

The firm's cash flow (CF) due to financing activities in the second year is - $450 million

Explanation:

As we know that,

Net increase in cash = Operating activity - investing activity - financing activity

where,

Net increase in cash = Ending balance of second year - ending balance of first year

= $280 million - $200 million

= $80 million

The other items values would remain the same

Now put these values to the above formula

So, the value would equal to

$80 million = $1,170 million - $640 million + financing activity

$80 million = $530 + financing activity

So, financing activity = $80 million - $530 million

= - $450 million