Camera Co. sold equipment with a cost of $22,000 and accumulated depreciation of $6,000 for an...

Question:

Camera Co. sold equipment with a cost of $22,000 and accumulated depreciation of $6,000 for an amount that resulted in a gain of $5,000. What amount should Innovativions report on the statement of cash flows as 'proceeds from sale of plant assets'?

A. $11,000

B. $16,000

C. $21,000

D. Some other amount

Cash Flow from Investing Activities:

In the second section of the cash flow statement, the cash generated by investing activities is presented. This includes all cash spent on the acquisition of long-term assets as well as all proceeds from the sale of long-term assets.

Answer and Explanation:


The proceeds were:

Cost $22,000
Accumulated depreciation (6,000)
Book value $16,000
Gain on sale 5,000
Proceeds from the sale of plant assets $21,000


The correct option is C.


Learn more about this topic:

Loading...
Preparing a Cash Flow Statement by the Indirect Method

from Accounting 301: Applied Managerial Accounting

Chapter 15 / Lesson 3
2.3K

Related to this Question

Explore our homework questions and answers library