Question

A.The loss on the cash sale of equipment was $22,125 (details in b).

Answer 1

Answer:

Statement of cash flows for the year

Cash flow from Operating Activities

Loss on sale of equipment                                $22,125

Net Cash Provided by Operating Activities     $22,125

Cash flow from Investing Activities

Proceeds from sale of equipment                   $28,625

Purchase of equipment                                   ($64,000)

Net Cash used by investing activities             ($35,375)

Cash flow from Financing Activities

Note Payable Issued                                           $5,700

Repayment of Note Payable                           ($58,625)

Issue of Common Stock                                    $84,000

Cash Dividends Paid                                        ($53,500)

Net Cash used by Financing activities            ($22,425)

Explanation:

Statement of cash flows for the year shows results of cash resulting from the following activities :

1. Cash flow from Operating Activities
2. Cash flow from Investing Activities
3. Cash flow from Financing Activities