Out of the following which one is not cash outflows from operating ac…

The correct answer is Option (4) → Dividends paid on equity and preference capital.

Operating activities are the main revenue-producing activities of the business, so their cash outflows are the payments made to run it: suppliers, employees, insurance and income tax. A dividend is a return paid to the owners who supplied the capital, so it is a financing outflow, not an operating one.

• Option (1) Cash payments to suppliers for goods and services. — A cash outflow from operating activities. Buying goods and services is part of the day-to-day business.

• Option (2) Cash payments to and on behalf of the employees. — A cash outflow from operating activities. Salaries and wages are a cost of running the business.

• Option (3) Cash payments to an insurance enterprise for premiums and claims, annuities, and other policy benefits — A cash outflow from operating activities. Insurance premiums are a routine operating expense.