Milliken Company paid $3.00 million to purchase stock in another company, $1.40 million to repurchase treasury shares, $1.50 million to buy short-term investments, sold used equipment for $0.84 million when its book value was $1.20 million, and purchased new equipment for $3.8 million. What was the net cash flow from investing activities

Net cash flow from investing activities is -$7.46 million.

Explanation:

Cash Flow from Investing Activities refers to the section of the cash flow statement of an organisation that shows the amount that been utilized in or made from making investments durin a particular accounting period. Examples of investing activities are purchases and sales of investments, long-term assets like property, plant, and equipment, etc.

Net cash flow from investing activities for Milliken Company can be calculated as follows:

Milliken Company

Calculation of net cash flow from investing activities

Details                                                             Amount ($'million)  

Purchase stock in another company                     (3.00)

Buy short-term investments                                    (1.50)

Sold used equipment                                              0.84

Purchased new equipment                                    (3.80)  

Net cash flow from investing activities                 (7.46)  

Therefore, net cash flow from investing activities is -$7.46 million.

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