During 2015 Stout Inc had the following activities related t

During 2015, Stout Inc. had the following activities related to its financial operations:

The amount of net cash used in financing activities to appear in Stout\'s statement of cash flows for 2015 should be

	Carrying value of convertible preferred stock in Stout, converted into common shares of Stout		$  360,000
	Payment in 2015 of cash dividend declared in 2014 to preferred shareholders		186,000
	Payment for the early retirement of long-term bonds payable (carrying amount $2,620,000)		2,650,000
	Proceeds from the sale of treasury stock (on books at cost of $258,000)		300,000

Solution

Net cash used in financing activity is Payment in 2015 of cash dividend declared in 2014 to preferred shareholders 186000 Add : Payment for the early retirement of long-term bonds payable 2650000 Less : Proceeds from the sale of treasury stock 300000 Net cash used in financing activity 2536000 Hence 3rd option is correct