In preparing a company’s statement of cash flows for the most recent year, the following information is available:
LOSS ON THE SALE OF EQUIPMENT…14,000
PURCHASE OF EQUIPMENT…145000
PROCEEDS FROM THE SALE OF EQUIPMENT…126000
REPAYMENT OF OUTSTANDING BONDS…87000
PURCHASE OF TREASURY STOCK…62000
ISSUANCE OF COMMON STOCK…96000
PURCHASE OF LAND…115,000
INCREASE IN ACCOUNTS RECEIVABLE DURING THE YEAR…43000
DECREASE IN ACCOUNTS PAYABLE DURING THE YEAR..75000
PAYMENT OF CASH DIVIDENDS…35000
Net cash flows from investing activities for the year were:
A. $134,000 of net cash used by investing activities.
B. $134,000 of net cash provided by investing activities.
C. $120,000 of net cash used by investing activities.
D. $252,000 of net cash used by investing activities.
E. $221,000 of net cash provided by investing activities.
1 Answer
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A 134,000 outflow.
Ignore the book loss on sale of equipment, instead use its Proceeds from the sale of 126,000, less Eqpt and Land purchased of 260,000 = 134,000
