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Dividend paid: |
Can be both outflow and inflow from Financing Activities Is always cash outflow from Financing Activities Can be outflow or inflow from operating activities Is an outflow of Operating Activities |
Is always cash outflow from Financing Activities |
The correct answer is Option (2) - is always cash outflow from Financing Activities. Dividend paid is categorized as a cash outflow from financing activities. Financing activities involve transactions with the company's owners and creditors, and paying dividends is a distribution of profits to the shareholders. It is always a financing activity whether it is paid by trading organisations or non trading organisations. |
