Question

Cash dividend payments were $25,000. Long-term investments were sold for $79,000 cash. A building costing $198,000 was purchased using $19,800 cash, and the balance was financed with a mortgage note payable. Stock was issued to stockholders in exchange for $110,000 cash. A $44,000 loan was made to a local inventory supplier; the loan will be repaid in twelve months. Equipment used in operations was sold for $37,000. Repaid a long-term note payable for $92,000 cash. Cash received from short-term bank loans totaled $71,000. Determine Smith’s cash flows from investing activities.

Answer 1

Answer:

$4,200

Explanation:

Data provided in the question:

Cash dividend payments = $25,000.

Cash from selling of Long-term investments = $79,000.

Cash used for purchasing a building costing $198,000 = $19,800

Sale of equipment = $37,000

Long term note payable = $92,000 cash

Now,

The net cash from investing activities will be

= sale of long term investments - purchase of building + sale of equipment  - purchase of investments

= $79,000  - $19,800 + $37,000 - $92000

= $4,200.