Now let's move to the financing activity section of the statement of cash flow. Remember that the financing activity section contains cash flows associated with transactions with investors or owners and with creditors. We would find accounts related to those In the liabilities and owners equity sections of the balance sheet. Let's look at those. The loan payable account resulted from a transaction with the bank, a creditor, and is associated with the companies original loan. The account's balance went down by $10,000 during the year because of the principle repayment. I put that $10,000 in the financing activity section under repayment of a loan principle. I put it in parenthesis because it is an outflow. The company took out an additional loan for $90,000. Also a transaction with a creditor to finance the purchase of the land. I include the increase in that account in the financing activity section as well as a cash inflow under proceeds from a loan. I can now check off those two liability accounts on the balance sheet. Because I've included the entire change on those balances. Let's move now to the younger's equity section. Recall that the company is should start to a new investor and the balance in that account increased. By $20000. [BLANK AUDIO] I put that increase in the financing activities section as a cash inflow under proceeds from the issuance of stock. Now going back to the balance sheet I can check off the change in the capital stock account at this point. Now let's take a closer look at the balance sheet. There's one liability account, dividends payable. And one owner's equity account, retained earnings that I haven't yet checked off. Look at the retained earnings to your account. I've included that income on the statement of cash flow already. The only thing in the retained earnings account I haven't included Is the $8,000 in dividends. Now remember, payment of dividends under US gap shows up in the financing section of the statement of cash flow but recall that the company declared dividends but is not yet paid them. So even though they affect the retained earning balance I don't want to include them on the statement of cash flow as if it were a cash out flow because a cash out flow hasn't occurred. At the same time, look at the dividend payable account whose balance increased by eight thousand dollars. So I have a liability account been increased by eight thousand and that owner's equity account that decreased by eight thousand. These two both related dividends offset each other does have no impact on cash. So, nothing related to dividends at this point shows up on the statement of cash flows. I'm going to check this two off. If we total the cash flow from financing activities, we see that it's a total in flow of $100,000. And now we've completed our work on the financing activities section. And, finally, I sum the cash flow from operating activities, the cash flow from investing activities, and the cash flow from financing activities, to get a total change in cash of $7,600. This is exactly the change in the cash balance on the balance sheet. So I can now check off the cash account on the balance sheet because I have included its change on the cash flow's date. Now we have completed our work on the statement of cash flows.