Smith Company elected to use the cumulative earnings approach for distributions from its equity-method investment purchased at the beginning of 20X1. During 20X1, Smith earned $244,000 on the investment and received $110,000 in dividends. In its statement of cash flows direct method, Smith should report the dividends as a(n): a) investing activity. b) financing activity. c) operating activity. d) noncash investing and financing activity.