Land costing $71,000 was sold for $50,000 cash. The loss on the sale was reported on the income statement as other expense. On t

Question

3 years ago

12

Land costing $71,000 was sold for $50,000 cash. The loss on the sale was reported on the income statement as other expense. On t

he statement of cash flows, what amount should be reported as an investing activity from the sale of land?
a. $71,000
b. $121,000
c. $50,000
d. $21,000

Business

1 answer:

Nataliya [291] · Answer 1 · 2022-08-29T23:02:43+03:00

Answer:

c. $50,000

Explanation:

The investing activities of cash flow deals with the actual cash received/paid by the entity/corporation from the investing activities. Since in the given question, the actual cash received by the entity from the sale of lands amounts to $50,000, therefore the $50,000 shall be included in the investing activity section of the Cash flows from the sale of land and accordingly the answer shall be c. $50,000