How should these equipment transactions be reported

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Question - Duke Company sold used equipment for cash. No gain or loss was recorded. A few days later, Duke replaced the equipment by paying a cash down payment and signing a note payable for the remainder of the balance for the new equipment. The cash down payment exceeded the cash received for the old equipment.

How should these equipment transactions be reported in the investing activities section of Duke's statement of cash flows?

A. Cash inflow equal to the cash received and a cash outflow equal to the down payment and note payable.

B. Cash outflow equal to the down payment less the cash received.

C. Depends on whether Duke reports under the direct or indirect method.

D. Cash inflow equal to the cash received and a cash outflow equal to the down payment.

E. Cash outflow equal to the down payment and note payable less the cash received.

Reference no: EM133006825

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