Reference no: EM131737389
Q1. A company had the following cash flows for the year:
Purchased inventory, $60,000
Sold goods to customers, $90,000
Received loan from a local bank, $150,000
Purchased land, $180,000
Purchased treasury stock, $40,000
Paid dividends, $10,000
Sold delivery truck, $30,000
What amount would be reported for net investing cash flows on the Statement of Cash Flows?
($150,000).
($180,000).
$30,000.
($190,000).
Q2. Alliance Products purchased equipment that cost $120,000. It had an estimated useful life of four years and no residual value. The equipment was depreciated by the straight-line method and was sold at the end of the third year of use for $25,000 cash. Alliance should record:
A gain of $5,000.
A loss of $5,000.
Neither a gain nor a loss since the computer was sold at its book value.
Neither a gain nor a loss since the gain would not be recognized.