Dividend paid by a company to its shareholder is classified as which type of activity under cash flow statement?
- ACash flow from operating activities
- BCash flow from investing activities
- CCash flow from financing activities
- DCash flow from extraordinary activities
Solution & Step-by-step Explanation
Financing activities are actions that alter the scale and setup of a company’s paid-up equity capital and long-term borrowing lines. Paying dividends directly rewards equity providers for their capital contribution, meaning it is classified under Cash flow from financing activities.