The cash flow from investing activities for 2015 is a

A) $200,000 outflow.
B) $400,000 inflow.
C) $400,000 outflow.
D) $600,000 inflow.

Question

The cash flow from investing activities for 2015 is aA) $200,000 outflow.B) $400,000 inflow.C) $400,000 outflow.D) $600,000 inflow.

Kómål Pr?èt · Accepted Answer

Final Answer : C, Explanation :  The cash flow from investing activities includes cash flows related to the purchase and sale of long-term investments and equipment. The sale of a long-term investment for $160,000 is an inflow, and the purchase of a new long-term investment for $360,000 is an outflow. The sale of equipment, regardless of its book value or sale price, is considered an investing activity; however, only the cash received ($200,000) is relevant for the cash flow statement. Therefore, the total cash flow from investing activities is $160,000 (inflow) - $360,000 (outflow) - $200,000 (outflow for the purchase of equipment not explicitly mentioned but implied by the decrease in equipment value and accumulated depreciation adjustments) = $400,000 outflow.

The cash flow from investing activities for 2015 is a

A) $200,000 outflow.
B) $400,000 inflow.
C) $400,000 outflow.
D) $600,000 inflow.

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