A Mutual Fund Company receives a dividend of ₹20 Lakhs on its investments in another company's shares. Where will it appear in a Cash Flow Statement?
Answer & explanation
Correct answer: option 1
The correct answer is option 1- Cash Flow from Operating Activities.
A Mutual Fund Company receives a dividend of ₹20 Lakhs on its investments in another company's shares. It appear in the operating activity Cash Flow Statement.
In case of a financial enterprise (whose main business is lending and borrowing), interest paid, interest received and dividend received are classified as operating activities while dividend paid is a financing activity.